EUR/USD: Extra gains expected above 1.0300 – UOB

In the opinion of FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang, gains in EUR/USD could accelerate once 1.0300 is cleared.

Key Quotes

24-hour view: “We expected EUR to ‘trade between 1.0160 and 1.0260’ yesterday. However, EUR rose to a high of 1.0275 before closing on a firm note at 1.0261 (+0.42%). Upward momentum is beginning to build and the bias for today is tilted to the upside. However, it is left to be seen if EUR could break the major resistance at 1.0300 (there is another resistance at 1.0285). Support is at 1.0230 but only a break of 1.0205 would indicate that the build-up in momentum has fizzled out.’

Next 1-3 weeks: “We have held the same view since last Thursday (28 Jul, spot at 1.0205) where the current movement in EUR appears to be part of a consolidation phase and it is likely to trade between 1.0100 and 1.0285. EUR rose to a high of 1.0275 yesterday before closing on a firm note at 1.0261 (+42%). Shorter upward momentum is beginning to build and the risk appears to be shifting to the upside. That said, EUR has to break 1.0300 first before a sustained advance is likely. At this stage, the chance for EUR to break 1.0300 is on the high side as long as it does not move below 1.0165 (‘strong support’ level) within these couple of days. Looking ahead, the next resistance above 1.0300 is at 1.0360.”