The pair keeps the near term neutral bias according to FX Strategists at UOB Group, while it could also attempt a test of the 110.50 area in the next weeks.
Key Quotes
24-hour view: “We expected a higher USD yesterday but were of the view that “a break above the major 110.10 resistance seems unlikely”. USD hit an overnight high of 109.85 before extending its up-move after NY close (high of 109.96 at the time of writing). Upward momentum has improved considerably and from here, we expect USD to move above the 110.10 level. That said, 110.50 is another major resistance and this level is unlikely to yield so easily. Support is at 109.65 followed by 109.35″.
Next 1-3 weeks: “The strong bounce in USD last Friday has put paid to our recent expectation for a deeper pullback to 107.90. The robust rebound suggests that USD has likely found a short-term bottom at 108.10 last week. However, there is no change to the current neutral outlook even though the immediate bias is for USD to probe the top of the expected 108.50/110.50 consolidation range”.
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