Investors were wary of trading the US dollar at the start of the week ahead of this week's focal event, the FOMC meeting.
Last week the US dollar managed to strengthen its position compared to most other major currencies after readings of consumer and producer inflation data respectively recorded an increase.
This gives an early indication of monetary policy setting by the Federal Reserve (Fed) which is likely to still delay interest rate cuts.
Despite a significant rally on Thursday after the data was published, the US dollar's momentum faded on Friday to close flat for the week.
As can be seen on the chart of the EUR/USD currency pair, a bearish pattern started to appear on Thursday below the 1.09000 zone before the price leveled off on Friday below it.
The price also moved below the Moving Average 50 (MA50) barrier line on the 1-hour time frame on the chart giving a bearish signal for further movement.
If the US dollar continues to strengthen, the price will continue the bearish movement from the 1.09000 zone and then towards the 1.08000 concentration zone.
In fact, prices could plummet even more if a major impact occurs when the results of the FOMC meeting are announced later.
It is also not impossible for the price to jump high past the 1.09000 zone again if the US dollar experiences a significant decline.
The price can overcome the levels of the previous week and then head towards the target at the height of 1.10000 while recording the latest 10-week high level.
