The US dollar started the early week trading well yesterday as it continued to strengthen following the reaction to the comparison of data published in the European and New York sessions.
Reading figures for the manufacturing and service sectors in the United States (US) for July were better than in Europe which came out with readings that were slightly down.
Because of that, investors witnessed a fall in the value of European currencies including the Euro following the publication of the data.
The data reading for Europe was reported to be the lowest since the Covid-19 pandemic, which will slightly disrupt the central bank's plan to continue policy tightening after this.
Analysts expect the US dollar still has the potential to continue strengthening ahead of the FOMC meeting early Thursday with the forecast of interest rate hikes to be implemented by the Federal Reserve (Fed).
As expected by analysts, the chart of the EUR/USD currency pair continued the bearish pattern at the opening of yesterday's early week that surpassed the lows at the end of last week.
If observed, prices briefly tested the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the chart before bouncing back down until the end of the New York session.
The price rose to the level of 1.11470 before falling sharply and ending the trade at the latest low around 1.10600.
The Asian session this morning (Tuesday) saw slow price movement with attempts to make some weak gains.
The bearish pattern is still expected to continue with the target for the price heading towards the 1.10000 concentration zone.
If the price breaks lower, the next 1.09000 zone will be headed before the lower target will move to 1.08000.
However, if the price returns to make a surge higher above the MA50 barrier, it will be an early signal of the potential for the price to change direction.
A move higher will lead back to the 1.12000 level or the height of the price level reached last week.
