The latest statement delivered by the Chairman of the Federal Reserve (Fed) Jerome Powell at midnight yesterday gave the latest indication to the market.
In his speech, Powell said the central bank should not wait until inflation reaches its 2% target to implement interest rate cuts because that would take too long.
His dovish tone is seen to support expectations for the Fed to switch to policy easing in the near term, which will at the same time have a depressing effect on the US dollar.
However, the US dollar is seen to be moving steadily towards the close of trading in the New York session, not yet showing a significant fall in value.
But with the latest indication, investors are getting ready to expect pressure on the currency king's moves.
If you look at the chart of the EUR/USD currency pair, the price moved relatively flat for the opening of the early week yesterday, but was still able to record the latest high around 1.09200.
The price fell back to the 1.09000 level which is an important focus zone for prices to evaluate price reactions to get further price direction.
The slow movement in the Asian session this morning (Tuesday) was seen testing the support level of the Moving Average 50 (MA50 on the 1-hour time frame on the EUR/USD chart.
If the price bounces back up, it will indicate that the price is ready to resume the previous bullish trend movement and has the potential to continue to record recent highs.
The target for the continued bullish pattern is heading up to around 1.10000.
However, if the display price that is below the 1.09000 zone starts to make a decline below the MA50 line, investors will evaluate it as an early signal for a change in the price trend.
After more clarity, the price could likely fall lower towards the previous concentration zone at around 1.08000 again.
