The desire of the dollar to occupy a dominant position in the pair EUR / USD is supported by the low volatility of the European currency. The euro goes through the crucible of disappointment and fatigue from trade wars and economic turmoil, while the greenback, on the contrary, is experiencing a surge of strength.
Even the law on support for protesters in Hong Kong, signed by US President Donald Trump, could not affect the positive attitude of the "American". This step provoked a slight weakening of the greenback, although it managed to return quickly to the service. According to analysts, buyers will support the US currency as long as there is still hope for a trade deal between Washington and Beijing.
A number of factors played into the hands of the dollar, including stunning statistics on the macroeconomic indicators of the United States. For the third quarter of this year, the country GDP showed explosive growth, which surprised and delighted experts. This caused a chain reaction in the market, triggering an increase in yield on US government bonds. In addition, investors were encouraged by the US labor market and durable goods sales. On this wave, market players were actively buying the dollar and selling the euro. The current situation has contributed to the stability of the dollar index against a basket of major world currencies.
On Thursday, November 28, the EUR / USD pair showed moderate volatility. A day earlier, the European currency was declining in tandem, while the EUR / USD pair, fell to 1.0992 after the release of strong data on the US economy, including the GDP and durable goods.
The key level on Thursday for the pair EUR / USD remained the range of 1.1013–1.1015. Buyers of the European currency tried to raise tandem quotes above this level, but the attempt failed.
Moreover, the EUR / USD pair began to decline steadily, almost reaching the bottom. The tandem dropped to the psychologically important level of 1,1003–1,1004. According to experts, the EUR / USD pair found a balance near the key round level of 1.1000, while not having strong drivers to form a new impulse.
Friday morning of November 29, the EUR / USD pair began on a major note, as the pair showed a moderate rise, stepping to the level of 1,1010, where the market perked up, but it was too early to rejoice.
In the future, the pair will be in the grip of bearish sentiment again trading at around 1,1007–1,1008, contrary to this, analysts expect a small but stable tandem growth.
The European currency in the EUR / USD pair is under more pressure than the American currency, experts emphasize. At the same time, the US dollar, like an experienced strategist, is strengthening its position step by step. This happens not only in the classic EUR / USD pair but also in other currency pairs, such as the USD / JPY.
Greenback's potential is large enough not only to resist difficulties but also to expand its leadership in the global financial market. However, the euro also should not be written off, analysts are sure. A single currency can sometimes lose a local battle, but not a war, and you should not consider it an outsider of the financial market, economists conclude.