The US dollar was seen to recover slightly on Wednesday's trade yesterday, not continuing further declines after a significant impact following the reaction to the United States (US) inflation data that was published last Tuesday.
Despite recovering from the biggest drop in 1 year, analysts still warn of the risk that the currency king will experience further depreciation.
Plus the US producer price index (PPI) data published yesterday also showed the biggest contraction since April 2020.
The reading, which is in line with consumer inflation that has also slowed down, reinforces expectations for the Federal Reserve (Fed) to slow down their previous policy tightening.
Observing the price movement on the chart of the EUR/USD currency pair, the price which has reached a height of 1.08870 after the spike in the inflation data was published, did not continue the rise to a higher level.
On the other hand, the price was flat throughout Wednesday yesterday until trading resumed in the Asian session this morning (Thursday) seeing the price hovering around 1.08400.
The signal remains bullish with the price movement still above the support level of the Moving Average 50 (MA50) on the 1-hour time frame on the EUR/USD chart.
The price drop that occurs is seen to test that level and the 1.08000 zone for investors to watch for signals for further price movement.
If it breaks lower down, the price decline will continue to reach around 1.07000 again.
However, if the price surges back to resume the previous pattern, the latest high level will be recorded again.
The closest target for the price is reaching the 1.1000 level after the last time the price traded around that last August.
