The US dollar continued to trade lower over the weekend as the tariff war escalated, raising risks to the US economy.
President Donald Trump has imposed tariffs of up to 145% on China and on Friday, Beijing retaliated with tariffs on US imports of up to 125%.
Over the weekend, the Trump administration announced an exemption from tariffs on electronics from China, which provided some relief to tech giants like Apple that rely on imports from the country.
US producer price index (PPI) data released on Friday also came in with a declining reading, indicating pressure on prices.
Looking at the price movement on the EUR/USD currency pair chart, the daily gain reached almost 300 pips on Friday.
The level around 1.14700 was the highest price reached in a 3-year trading period.
However, there was a price pullback of around 200 pips from that peak to the 1.13000 zone.
Continuing trading at the opening earlier this week, the price opened above 1.13000 showing a 100 pip increase testing the 1.14000 level.
The upward pattern is expected to continue with expectations for the US dollar to continue moving weakly in the market this week.
The target for a higher price increase is to overcome the level reached last week before heading towards 1.15000.
A change in price direction will occur if there is a decline below the 1.13000 zone after a new high level fails to be recorded.
The price decline will head towards previous focus levels such as 1.12000 and the important zone at 1.11000.
