EUR/USD still faces further consolidation – UOB

FX Strategists at UOB Group remain neutral on EUR/USD for the time being and expect the pair to navigate within the 1.12-1.13 range.

Key Quotes

24-hor view: “EUR also posted an ‘inside day’ as bull consolidate after a strong move. Due to the ‘inaction’, upside momentum has dwindled significantly and it would take time to gather strength again. As such, stiff resistances at 1.1240/1.1250 are unlikely to be significantly challenged. Today, we continue to expect sideways trading with supports at 1.1160 and 1.1125”.

Next 1-3 weeks: “As we reported in yesterday’s report, a NY close above 1.1130 would negate the ‘downside phase’. EUR closed up for a third day, by 0.85% to 1.1202. While upwards momentum appears strong, we are still not convinced to transit into a ‘positive phase’ as yet. As such, EUR is likely to consolidate recent gains and trades in a higher range between 1.1200 and 1.1300. A drop below 1.1160 indicates that the recent strength in EUR has ran its course and may be resuming its downtrend”.