The pair’s constructive stance could see a test of the 111.00 area in the near term, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “The rapid and robust rebound in USD yesterday came as a surprise. USD extended its gains after NY close and is currently approaching the strong 110.50 resistance. In view of the strong momentum, a break of this level seems likely and could lead to further advance to 110.80. Support is at 110.10 but only a move back below 109.75 would indicate that the current upward pressure has eased”.
Next 1-3 weeks: “USD recovered all and more of the decline made late last week as it extended its gains after NY close and is currently approaching the strong 110.50 resistance. The sudden swing higher came as a surprise and from here, a clear break of 110.50 would indicate that the current USD strength could test the 111.00 resistance (with lower odds for extension to last month’s top near 111.40). Overall, the outlook for USD appears to be ‘positive’ as long as the ‘key support’ at 109.40 is intact”.
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