EUR/USD: Further consolidation on the cards – UOB

EUR/USD is still seen trading within 1.0660 and 1.0870 in the next few weeks, suggest Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: “Yesterday, we noted ‘Upward momentum has improved somewhat’ and held the view that ‘while EUR could break above 1.0830; it is unlikely to threaten the next resistance at 1.0870’. Our view turned out to be correct as EUR rose to a 1.0848 before settling near the high at 1.0843 (+0.44%). Upward momentum has improved, albeit not much. Today, EUR could rise above 1.0870 but the chances of it staying above this level are not high. The next resistance is at 1.0900. Support is at 1.0820; a break of 1.0800 would indicate that the current upward pressure has eased.”

Next 1-3 weeks: “Our latest narrative was from two days ago (27 Mar, spot at 1.0775) wherein we were of the view that EUR ‘appears to have entered a consolidation phase and it is likely to trade between 1.0660 and 1.0870 for the time being’. While there is no change in our view, short-term upward momentum is building, albeit tentatively. Looking ahead, EUR has to break and stay above 1.0900 before a sustained advance is likely. The prospect of EUR breaking clearly above 1.0900 is low for now but it would remain intact as long as EUR stays above the ‘strong support’ level of 1.0770 in the next few days.”