Major currencies in the market were affected at the opening of April trade yesterday as the US dollar was seen to have managed to maintain its strength after the reaction to the latest published data.
The ISM survey of the manufacturing sector in the United States (US) for March showed a surprising number that exceeded the 50-point mark, indicating expansion in the sector since November 2022.
This has reduced the percentage of expectations for interest rate cuts by the Federal Reserve (Fed) in June, thus supporting the strengthening of the US dollar.
It can be observed that the downward movement of prices continued on the chart of the EUR/USD currency pair in the New York session yesterday.
After last week the price closed below the 1.08000 zone, the price was seen hovering below the Moving Average 50 (MA50) barrier line on the 1-hour time frame on the chart throughout the Asian and European sessions yesterday.
Then after the data was published in the New York session, the price has plunged significantly reaching the level of 1.07300 becoming the latest low for the 7-week trading period.
With the momentum shown and the expectation of continued strengthening of the US dollar, the price tends to continue the downward pattern towards the 1.07000 concentration zone.
The zone is seen as an important support for the price which was also tested in mid-February last, but the price did not succeed in breaking through.
However, if there is a rebound in price, the expectation is for the 1.08000 zone to be tested as the nearest resistance and the price will also try to break through the MA50 barrier.
If successfully breached, a further move higher would be expected towards 1.09000 after investors assess the indications for a change in the price trend.
See the picture of the price chart of the EUR/USD pair below for your technical analysis reference.
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