The euro managed to keep up its positive dynamic while the greenback dropped after the release of weak economic reports and escalation of trade war tensions. Despite the US dollar has been the dominant currency in the pair for a few days, certain correction and volatility is expected.

Now investors are worried about the possibility of a global recession due to the modern political situation. Trump unexpectedly announced new tariffs on Mexico goods on Friday and tariffs on $200 billion of Chinese imports rose on Saturday to 25% from 10%. Bond markets are flashing a warning with three-month U.S. yields now well above 10-year rates, the so-called curve inversion that's foretold most 20th century U.S. recessions.

President Mario Draghi will give the Euro Zone economy a bit of a boost on Thursday in the form of generous loans to banks so they keep lending to businesses, while also leaving the door wide open to even more stimulus. The outlook for the euro area economy has turned quite dovish. The global trade war is showing no signs of dissipation, Italy is once again in conflict with the European Commission, German industry is continuing to post dismal figures, stocks are tumbling, inflation expectations are falling and the threat of a hard Brexit looms large

The European Commission wrote to Italy last week asking it to explain why its public debt rose in 2018 instead of falling as required, a move that set the stage for a possible legal clash with the ruling eurosceptic coalition in Rome. In his response to Brussels, Economy Minister Giovanni Tria blamed an economic downturn for the rising debt and vowed to respect the EU's fiscal rules in the next budget.

Ahead of US Non-Farm Employment Change, Average Hourly Earnings and Unemployment reports, Jeromy Powell, the Fed Chairman, is going to speak about the US economy weakening and the Fed's policy.

Presently, it's hard to determine the movements of the US dollar because of the rapidly changing political environment. The euro has recently weakened. However, it may gain if Draghi' speech improves market sentiment.

Now let us look at the technical view. The price is currently rejecting off the dynamic level of 20 EMA after pushing higher towards 1.1200 area. As the preceding trend is bearish, the price has a greater probability to push lower following the trend if the dynamic level resistance manages to hold the price as strong resistance while also residing below the 1.1200 area. The target area for downward pressure would be 1.1000-50 area from where certain bounce can lead the price higher again towards 1.1200 area in the future.