EUR/USD back to the 1.0500 zone

The recovery of the euro against the US dollar was short-lived and is now near daily lows. The greenback remains strong in the market on the back of Fed rate hike expectations. 

US bond yields continue to rise supporting the US dollar. The 10-yield reached 2.50%. But today, equity prices in Wall Street are retreating with main indexes falling from record highs levels. 

EUR/USD bottomed earlier at 1.0498, slightly above the February low that lies at 1.0492. From the lows it bounced to the upside but the recovery was capped below 1.0530 and under the 20-hour moving average. Now the pair is hovering around 1.0500 as the US dollar regains strength in the market. 

Bearish signals? 

The pair is falling for the third day in a row, headed toward the lowest daily close since January 4. So far, it has been able to hold above 1.0500. 

The euro continues to move with a downside bias within a channel. A clear break under 1.0500, could trigger a decline toward 1.0450, where the next strong support is seen. If the slide continues, attention would turn to 1.0400 and 1.0340 (2017 low).