The pair remains neutral while extra consolidation is likely in the next weeks, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “USD traded within a range of 109.35/110.20 yesterday, relatively close to our expected 109.30/110.10 consolidation range. However, the daily closing in NY is on the strong side (close at 110.04) and this could lead to further gains. That said, any up-move is expected to struggle to move above the 110.45 resistance. Higher up, last week’s top at 110.75 is not expected to come under threat, at least not for today. Support is at 109.80 followed by 109.50″.
Next 1-3 weeks: “USD traded in a choppy manner yesterday as it dropped to a low of 109.35 before rebounding quickly. The price action offers no further clue and we continue to hold a neutral view and expect USD to trade sideways within a 109.10/110.65 consolidation range for now. Looking ahead, the downside appears to be more vulnerable and a clear break of 109.10 would suggest that USD is ready to test last month’s low near 108.10″.
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