Investors entered the market cautiously at the market opening earlier this week due to risk-off market sentiment.
The situation was triggered by the tariff war following President Donald Trump’s increasingly aggressive implementation of import taxes, especially on Canada, Mexico and China.
Canadian Prime Minister Justin Trudeau did not wait long to immediately announce a 25% retaliatory tariff on the United States (US), the same amount as imposed by Trump.
Risk-off sentiment has strengthened the US dollar as a safe-haven currency until a price difference was formed on the main chart at the opening of the Asian session this morning (Monday).
Like the EUR/USD currency pair chart, the price opened 100 pips lower than the close of the last session last week.
As the end of the week approaches, the price showed a horizontal movement before declining below the 1.04000 zone with an early signal for a bearish movement when the price was below the Moving Average 50 (MA50) resistance line on the 1-hour time frame on the chart.
Closed around 1.03500 last week, the price reopened around 1.02400 this morning which is seen approaching the 1.02000 focus zone.
If the advantage continues to favor the US dollar, the price will drop lower below 1.02000 before extending the decline to a new target at 1.01000.
However, if the situation changes, the price could bounce back to try to surpass the 1.03000 level which is also seen as the previous focus level.
If it succeeds in breaking through, the increase will return to last week's focus zone at 1.04000.
