In opinion of FX Strategists at UOB Group, the recovery in EUR/USD could extend to the 1.1800 area in the next weeks.
Key Quotes
24-hour view: “We highlighted yesterday that ‘there is room for EUR to test 1.1720’. We added, ‘the strong resistance at 1.1745 is not expected to come under threat’. However, USD breached 1.1745 as it rose to 1.1750 during late NY session. Upward momentum has improved, albeit not by all that much. From here, EUR could edge above 1.1770 but is unlikely to challenge the major resistance at 1.1800. Support is at 1.1730 followed by 1.1715.”
Next 1-3 weeks: “The weak phase in EUR that started in the middle of last ended abruptly as EUR rebounded yesterday and took out the ‘strong resistance’ level at 1.1745 (high of 1.1750). The rebound appears to have scope to extend to 1.1800. At this stage, the odds for a sustained advance above 1.1800 are not high. On the downside, a break of 1.1795 (‘strong support’ level) would indicate that the current build-up in momentum has eased.”
