Last week ended with the success of the dollar against the euro and analysts warn that this trend is gaining impulse. In this regard, the euro is rapidly losing its position in view of the dollar's strengthening.

Experts said that the current situation shows in favor of a long downward trend of the EUR/USD pair, so the possibility of the pair falling to the extremely significant level of 1.1500 is no longer interesting. During the day, the EUR/USD pair started at 1.1638-1.1639, repeating last week's decline. However, the classic pair does not give up, trying to get out of the downturn.

Last week, analysts recorded a rapid decline of the Eurocurrency to new lows. This is due to the gloomy mood in the financial markets amid the tightening quarantine measures associated with the COVID-19 pandemic. According to investors, even small lockdowns introduced in a number of countries can prevent a full recovery of the global economy.

The current conditions are extremely favorable for the US currency, which has managed to take advantage of the weakness of its rival and catch up. This is being supported by the refusal of US President Donald Trump from another lockdown, which contributes to the further growth of the national currency. The US President is not seeking serious restrictions related to COVID-19 before the presidential elections, since he is scared that the next quarantine measures will harm the US labor market.

The active growth of the USD has put a foothold on risky assets. Earlier, Credit Suisse experts drew attention to the toxic atmosphere for risky assets present in global markets. Investors and traders are afraid of an explosive volatility increase of the EUR/USD pair in the near future. Against this background, market players "cut" their long positions, and this trend may be long-term. In turn, experts expect a correction and its further decline to the levels of 1.1500-1.1400.

All the bulls' efforts are invalidated by the steady decline of the euro. According to analysts, euro bulls are under attack, and this pressure will increase. At the moment, the bears are among the favorites of the market. However, experts find it difficult to say how long they will be in the lead. They fear that a "bearish" takeover will form in the EUR/USD pair against the euro, and then the "bulls" will face a long period of decline.

Despite the current difficulties, the single currency is seeking to overcome the long-term downward trend that began in 2008. It has repeatedly tried to reverse the negative trend, but these efforts were unsuccessful. In July 2020, this currency broke the downward trend for the first time, reaching the level of 1.1700, but this success was temporary. Currently, experts are recording a firm decline of the euro. Its steady decline below the downward trend line opens the way for the EUR/USD pair to 1.1400.

Currency strategists at Danske Bank agree with this opinion, noting that the pressure on the euro will continue until the end of this year. Bank experts are confident that its growth can only be expected by the beginning of 2021. They also believe that the EUR/USD pair will remain in the range from 1.1500 to 1.1900 by the end of the year.

They consider two fundamental factors negatively affecting the single currency – dollar's strengthening, which has grown stronger due to Fed's new approach to targeting inflation, and the probability of introducing quarantine measures due to COVID-19. Analysts said that a new round of restrictions due to rising cases of COVID-19 is weakening the pace of economic recovery in the eurozone.

Several factors contributing to its strengthening have become a minor problem. Danske Bank considers the conclusion of a mutually beneficial trade deal between the UK and the EU, as well as a favorable outcome of the US presidential election, to be potential drivers for euro's strengthening. However, these factors, in which political ambitions play a major role, are very unstable. Their positive impact on the dynamics of the Euro is questionable, which does not add positivity to the euro bulls.