The US dollar currency began to show a recovery at the end of last week's trading which has strengthened from the decline of the previous period.
Analysts see a 'price-in' situation in prices heading into this week's FOMC meeting with the expectation that interest rates will be increased by 25 basis points which could have the effect of increasing the value of the US dollar.
However, the US dollar is at risk of weakening again after that as policy tightening measures are expected to come to an end, but the follow-up speech by Chairman Jerome Powell will be the compass of the US dollar's further journey.
The price chart of the EUR/USD currency pair is starting to show a change in the previously bullish price movement trend.
After leveling off since the beginning of the week above the 1.12000 zone, the price started plunging last Thursday with the previous signal of the price moving below the Moving Average 50 (MA50) barrier level on the 1-hour time frame of the chart.
On Friday, the price was flat around 1.11200 until the close of the last session of the week.
European investors will also be cautiously awaiting the results of the European Central Bank (ECB) policy meeting which is expected to raise interest rates by 25 basis points.
The price drop is expected to continue again at the beginning of this week with the expectation of the 1.10700 zone which will be tested by the price.
The continuation of the decline will see the price reach the previous concentration zone at 1.10000.
However, be alert if the price makes a surge back past the MA50 barrier which will signal a change in trend again.
The price will test the resistance at 1.12000 and if it succeeds in breaking through it, a higher move has the potential to overcome last week's highs before recording the latest highs.
European and US manufacturing and services PMI data will be monitored today for early price movements for the week's opening.
