EUR USD rebounds towards resistance

EUR/USD (daily chart shown below) has continued its rebound towards key resistance at 1.1100, a prior support target, which is also where the 50-day moving average is currently situated.

For the past week and a half, the current rebound has lifted the currency pair off its new 12-year low of 1.0461 that was established in mid-March. That low dipped only slightly below the major 1.0500 support target.

After that low was hit, EUR/USD quickly began a rebound in the middle of March that was buoyed further by the US Fed meeting on March 18, which resulted in a quick plunge in the US dollar. That EUR/USD rebound hit a high of 1.1037 on the day of the Fed meeting before retreating modestly during subsequent trading days.

Currently, although it has regained much of its rebound strength, the currency pair is still entrenched in a strong downtrend that has been in place for the past ten months, since the May 2014 high near 1.4000.

If upside momentum is able to break above the noted 1.1100 resistance and 50-day moving average, the next major resistance on an extension of the current rebound resides around the 1.1400 level.

To the downside, any turn back down from resistance on a resumption of the entrenched downtrend should likely re-target the 1.0800 and 1.0500 support objectives once again.

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