EUR/USD looks side-lined for the time being – UOB

Economist at UOB Group Lee Sue Ann and Markets Strategist Quek Ser Leang now see EUR/USD trading between 1.0900 and 1.1050 in the next few weeks.

Key Quotes

24-hour view: “We indicated yesterday that EUR ‘is likely to advance further but it remains to be seen if it can maintain a foothold above 1.1075’. EUR eked out a fresh year’s high of 1.1066 before plummeting to 1.0962. While the sharp and swift drop is oversold, there is room for EUR to decline further. However, the major support at 1.0900 is unlikely to come under threat (there is another support at 1.0940). Resistance is at 1.1000; a break of 1.1025 would indicate that the weakness in EUR has stabilized.”

Next 1-3 weeks: “Yesterday (25 Apr, spot at 1.1045), we highlighted that EUR ‘is likely to trade with an upward bias but it has to break and stay above the month-to-date high of 1.1075 before a move to the next major resistance at 1.1120 is likely’. We added, ‘a break of 1.0975 would indicate that the build-up in momentum has faded’. We did not anticipate the sharp drop in NY trade that took out our ‘strong support’ level of 1.0975 (low has been 1.0962). The build-up of upward momentum has fizzled out. In other words, instead of advancing, EUR is more likely to trade in a range for now, expected to be between 1.0900 and 1.1050.”