The situation started to change a little in trading towards the end of the week as investors reacted to the latest United States (US) economic data published yesterday.
At the opening of the New York session yesterday, US retail sales data for July was published with readings that rose above forecasts.
This shows that the level of consumer spending is still good and has reduced concerns about the risk of a global recession that hit the market last week.
The US dollar showed a strengthening at the start of the New York session yesterday when the data was published along with a good jobless benefits claims report, before weakening slightly at the close of the session.
Examining the price movement on the EUR/USD currency pair chart, the bullish pattern started to falter after the last high reached this week around the 1.10470 level.
The price has made a decline below the 1.10000 level again until reaching 1.09500 when the data reaction was published yesterday.
However, there was a price rebound before closing the end of the session around 1.09700 and leveling off around that at the early opening of the Asian session this morning.
A price drop below the Moving Average 50 (MA50) line on the 1-hour time frame on the EUR/USD chart signals the beginning of a bearish trend change.
The price is likely to extend the decline lower towards the previous concentration zone around 1.09000 again.
But if the decline does not happen, the price increase is expected to test the 1.10000 level as the closest resistance.
If the move higher successfully continues and also breaks through the MA50 barrier, the price is likely to signal a resumption of the previous bullish movement.
