EUR/USD could extend the advance to 1.1395 – UOB

FX Strategists at UOB Group now see EUR/USD attempting to retest the vicinity of the 1.1400 region in the next weeks.

Key Quotes

24-hour view: “We highlighted yesterday that the outlook is mixed and we expected EUR to ‘trade in a choppy manner between 1.1295 and 1.1365’. EUR subsequently dropped to 1.1311 but the decline was short-lived as it soared quickly to a high of 1.1374 during NY session. The rapid advance has gathered momentum but while EUR could move above 1.1395, it is left to be seen if it can maintain a foothold above this major resistance level (next resistance is at 1.1415). The current upward pressure is intact as long as EUR does not move below 1.1335 (minor support is at 1.1350).”

Next 1-3 weeks: “We have held the same view since last Tuesday (04 Jan, spot at 1.1305) where the outlook is unclear and we expected EUR to trade within a range of 1.1240/1.1395. After trading mostly sideways for more than a week, shorter-term upward momentum is beginning to build and EUR appears poised to move above the top of the expected range at 1.1395. A clear break of this level could lead to an advance towards 1.1440. The prospect for EUR advance further would continue to rise as long as it does not move below 1.1315 (‘strong support’ level) within these couple of days.”