Although it started to decline slightly at the closing trade of the last session last week, the US dollar is expected to resume its strengthening pattern this week.
This is because the market is still looking at the direction of monetary policy setting by the Federal Reserve (Fed) in the tightening phase based on the economic data published last week.
Manufacturing and service sector data as well as Gross Domestic Product (GDP) of the United States (US) will be monitored in addition to the minutes of the FOMC meeting, which will influence the trading course of the US dollar this week.
On the price chart of the EUR/USD currency pair, the price has been seen showing a decline until reaching the latest 6-week low around 1.06100 in the New York session last Friday.
However, the price bounced back to the 1.07000 concentration level at the close of the session.
Opening the trade earlier this week, the price hovered slowly below the 1.07000 zone and hovered above the Moving Average 50 (MA50) support level on the 1-hour time frame of the EUR/USD chart.
If the increase succeeds in continuing above the 1.07000 level, it is likely that the price will be able to reach the 1.08000 level.
The price reaction will be observed with the expectation that the resistance level will be the focus of price testing.
But with the expected US dollar that tends to be strong this week, the price drop will be expected towards the 1.06000 zone.
A further drop that penetrates the zone is seen to be headed towards around 1.05000 to record the latest low.
