In opinion of FX Strategists at UOB Group, EUR/USD faces rising bets of a move below 1.1740 in the next weeks.
Key Quotes
24-hour view: “Yesterday, we expected EUR to ‘trade in a lower range of 1.1760/1.1830’. However, it rose to a high of 1.1844 before ending the day on a relatively firm note at 1.1833 (+0.39%). Upward has improved a tad and for today, EUR could edge higher but a sustained rise above 1.1875 is unlikely (next resistance is at 1.1905). On the downside, a breach of 1.1785 (minor support is at 1.1810) would indicate the current mild upward pressure has eased.”
Next 1-3 weeks: “There is not much to add to our latest narrative from last Thursday (20 Aug, spot at 1.1845). As highlighted, the price action ‘is viewed as the early stages of a consolidation phase’ and EUR ‘is likely to trade between 1.1740 and 1.1950’. That said, the underlying tone has weakened somewhat and the risk of a break of 1.1740 first is higher. Looking forward, if EUR closes below 1.1740, it would indicate the start of a more sustained and deeper pull-back in EUR.”
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