The price movement pattern at the beginning of the week changed again when the strengthening momentum of the US dollar that was exhibited at the end of last week failed to continue yesterday.
The performance of the US dollar was dismal at the opening of the week as investors will continue to be cautious awaiting the focus of the United States (US) economic data to be published this week.
The US consumer confidence survey data will be the first to be noticed in the New York session later tonight before some other data will follow including US economic growth and the PCE price index at the end of the week.
Observing the movement situation that occurred on the chart of the EUR/USD currency pair yesterday, the price failed to drop lower below the 1.08000 zone after the decline at the end of last week approached that area.
A rebound was shown again yesterday from the 1.08000 zone, but at a slower tempo in the daily range of around 40 pips.
Although flat towards the end of the New York session, the price that has crossed the Moving Average 50 (MA50) barrier on the 1-hour time frame on the EUR/USD chart gives an early indication of price recovery.
If the price is successfully driven higher after this, the closest resistance is at the 1.09000 zone to be tested.
Next, it will be a bullish signal again for the price to re-target towards a new high at 1.10000.
However if the price pulls back down and hovers again below the MA50, the current support level at the 1.08000 zone will be tested.
If the price breaks down, it will signal that the downward pattern of last week will continue again with the target moving to the 1.07000 level.
