EUR/USD defends Fed rate cut-led gains above 1.1100

• EUR/USD stalls corrective slide near 1.1085, as USD weakness persists.
• DXY, Treasury yields dumped on surprise Fed rate cut to zero.
• Next of relevance remains the G7 and EU coronavirus response.

EUR/USD is back on the 1.1100 level, defending minor gains amid a stalled rebound in the US dollar across the board, as the US Federal Reserve’s (Fed) unexpected rate cut continues to keep the dollar bulls at bay.

 Despite the Fed’s rate cut and QE announcement, the sentiment remains sour amid growing concerns over a global recession due to the coronavirus outbreak, as investors remain wary over whether the global coordinated policy action will likely help ramp up growth.

The broad market nervousness continues to boost the flows into the US bonds, which translates into lower returns on the bonds, eventually pressurizing the greenback. The US dollar index trades around 98.25, down 0.50% on the day, having stalled its recovery just shy of 98.50.  

Markets now await the European Union (EU) Finance Ministers’ and G7 leaders’ economic response to the virus outbreak due later on Monday for fresh near-term trading opportunities in the main currency pair.  

EUR/USD technical levels to watch