Spot is seen extending its current sideline theme in the next weeks, according to FX Strategists at UOB Group.
Key Quotes
24-hour view: “Expectation for EUR to retest the 1.1740/45 did not materialize as it dipped to a low of 1.1651 before rebounding strongly. While upward momentum is not that strong, we continue to see scope for a test of 1.1740/45. An overshoot above this level is not ruled out but based on the current patchy momentum, a clear break above the next resistance at 1.1780 is not expected. Support is at 1.1685 but the stronger level is at yesterday’s low near 1.1650″.
Next 1-3 weeks: “We just shifted from a bearish to neutral stance on EUR yesterday and there is no change to the view. As highlighted, EUR has likely moved into a consolidation phase and is expected to trade sideways for now. Near-term, the bias is tilted to the upside but any advance is viewed as part of a 1.1600/1.1830 consolidation range and not the start of a sustained up-move”.
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