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FX Strategists at UOB Group noted EUR/USD could have now entered into a consolidative phase.

Key Quotes

24-hour view: “EUR dropped to 1.1734 during late NY session before ending the day on a soft note at 1.1736 (-0.42%). Downward momentum has improved, albeit not by much. That said, the bias from here is titled to the downside towards 1.1700. The next support at 1.1670 is unlikely to come into the picture. Resistance is at 1.1760 but only a move above 1.1785 would indicate the current mild downward pressure has eased.”

Next 1-3 weeks: “Last Tuesday (04 Aug, spot at 1.1760), we held the view that ‘the 3-week positive phase has run its course’ and we expected EUR to ‘trade sideways between 1.1600 and 1.1900’. After EUR popped higher, we indicated on Thursday (06 Aug, spot at 1.1870) that ‘upward momentum is beginning to improve but only a daily closing above 1.1930 would indicate that EUR is ready for 1.2000’. EUR subsequently eked out a fresh high of 1.1915 but was unable to hold on to its gains. The swift and relatively sharp decline last Friday suggests that 1.1915 could be a short-term top. While EUR is likely to trade below 1.1915 for the next couple of weeks, any weakness is viewed as part of a broad 1.1600/1.1880 range. In other words, barring a sharp and sudden pick up in downward momentum, any weakness in EUR is likely to be slow and a sustained decline below 1.1600 is unlikely.”