The US dollar has more to lose in a slowing global economy
The bottom line is that eurozone interest rates are virtually zeroed out while US rates are at 2.25%-2.50%.
That leaves the Fed with much more room to lower rates. The US is never going to get 10-year rates to -0.2% like they are in Germany but a fall to 1% could easily boost the euro back to 1.35 — baring a recession in the eurozone.
It’s also important to note that USD longs are a very crowded position and a rush to the exits could make for a bunch more candles like today’s.