EUR/USD: Bulls gathering pace for a test of yearly-high at 1.1214

• EUR supported by likely central bank divergence
• Coronavirus concerns-led risk-off knocks-off T-yields, US dollar.
• Markets eye fresh virus updates and US jobs data for fresh cues.

Having briefly regained the 1.12 handle in the last hour, EUR/USD is now seen consolidating the upside around the latter, as the bulls take a breather before the next push higher.

The yearly high of 1.1214 remains in sight for EUR/USD’s buyers, as unabated selling interest seen around the US dollar keeps them hopeful.

The greenback remains heavily offered across the board, hammered by another collapse in the US Treasury yields, as growing coronavirus cases in the US bolster the risk-off trading in the US equities the translates into increased demand for the US government bonds.

The 10-year Treasury yields are at a historic low below 0.920%, losing nearly 8% so far while the US dollar index drops 0.50% to hover near a new two-month low of 96.81.

Amid a panic across the US markets, investors are pricing in another Fed rate cut when the US central bank meets on March, 18^th. The Fed shocked the markets earlier this week, by delivering a 50bps rate cut to battle the virus fallout on the economy.

Meanwhile, the European Central Bank’s (ECB) likely 50bps rate cut is still awaited, leaving a monetary policy divergence between both continents, benefiting the euro at the expense of the buck.

Markets are also weighing in the downbeat US macro news, as the focus now shifts towards the key US labor market report due on Friday for a fresh trading impetus.

EUR/USD technical levels to consider