Judging from last week's trading, the US dollar has displayed a downward trend until the end of the week despite the latest US inflation data showing an increase.
Last Friday, US retail sales data came with a declining reading for January, further adding pressure to the US dollar.
This week the US dollar will be influenced by the FOMC meeting minutes as well as several other US economic data such as the manufacturing and services PMIs that will be published.
If we examine the movement on the EUR/USD currency pair chart, the US dollar's decline has pushed the weekly increase up to over 200 pips.
The price has risen from the support level of 1.03000 to reach the target of 1.05000 at the end of the week.
Continuing the opening at the beginning of this week, the price has slowed down at the height of 1.05000 in Asian session trading with a tendency for the price increase to continue.
This is following the bullish signal of the price movement remaining above the Moving Average 50 (MA50) support line on the 1-hour time frame on the EUR/USD chart.
If the price increase continues at the beginning of this week, the target is to head towards a height of around 1.06000.
Towards that target, the price will record a new 10-week high after surpassing the trading level reached in January.
However, if the price changes direction again, a decline can be expected to approach the level around 1.04000.
After the bearish signal is observed, the price can drop to last week's support level again, which is at 1.03000.
