EUR/USD: How much further could USD fall?

While gold is indeed a better store of value over fiat currencies and dare I say cryptos, the dollar is not dead... 

The Dollar Index has today fallen to its lowest level since June 2018, extending its recent declines as investors look forward to the conclusion of the FOMC meeting this evening for direction. However, while the Fed meeting is likely to be a damp squib of an event as no policy changes are expected to be announced, and while sentiment is increasingly turning bearish towards the greenback, I reckon there is a possibility the dollar may soon rise from the ashes and start rising again.
Investors have been dumping the US dollar amid an improving risk appetite and bets that the US economy will need the ongoing monetary support for much longer than would have been the case before Covid-19 struck. King Dollar turned into a funding currency in the space of a few months, as global investors piled into US equities, as well as gold and silver, as the actions of the Fed (and other central banks) depressed bond yields further. In fact, the real yield on 10-year US Treasuries closed at a record low on Tuesday.
Echoing the bearish sentiment towards the dollar, analysts at Goldman Sachs reckon its reign as the world's reserve currency is under threat, and that gold is "the currency of last resort."
Well, while I agree that gold is indeed a better store of value over fiat currencies and dare I say cryptos, the dollar is not dead. With so much monetary and fiscal stimulus in the economy, inflation could rise sharply if the economy re-opens and growth picks up as the Fed envisages. In the short-term, the dollar could find haven flows if coronavirus spikes again across the world.
Meanwhile, with gold and equity prices soaring to record levels, and bond yields continuing to be depressed, questions remain as to how long this trend will continue, given an uncertain economic outlook. So, there is definitely a growing risk we may see profit-taking as the ongoing trends have become very one-way, which is not sustainable.
EUR/USD faces massive resistance
As mentioned, the EUR/USD and several other dollar pairs, as well as gold and silver, have been rising sharply from their March lows. But the good run of form may come to an end soon, at least for a while anyway. That’s because the EUR/USD has entered THIS massive area of resistance:
EUR/USDSource: and ThinkMarkets
As the chart shows, the EUR/USD has entered a long-term resistance zone between 1.1715 to around 1.2000. As well as old highs and lows, here we also have a long-term bearish trend line connecting the highs since when the euro peaked in 2008. Thus, if and when price creates a reversal here, I would expect rates to then drop to the nearest trouble area around 1.1500 next. It could potentially fall further down the line, but that would be my immediate target.
However, if the EUR/USD manages to break the abovementioned 1.1715-1.2000 resistance range in the coming days and weeks, then a run towards the 2018 high of 1.25ish would become more likely than a sell-off back towards the 1.15 area.
With the current trend being bullish, the former scenario will only become active IF price creates a distinct reversal pattern, ideally while inside that 1.1715-1.2000 long-term resistance range. Until and unless that happens, I would continue to look for short-term bullish setups on the EUR/USD, even though it may be testing that critical resistance zone.