The probability of a visit to the 1.1500 area appears to have lost some momentum for the time being, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “Expectation for sideway trading yesterday was wrong as EUR dropped to a low of 1.1507 before staging a swift and robust recovery to hit an overnight high of 1.1633. While the rebound appears to be running ahead of itself, there is scope for a test of the 1.1645/50 resistance. At this stage, a move beyond the next resistance at 1.1680 is not expected. Support is at 1.1575 followed by 1.1540. The 1.1507 low is not expected to come into the picture for now”.
Next 1-3 weeks: “We have held the same view since Wednesday (20 Jun, spot at 1.1585) that “a dip below 1.1505 not ruled out but weakness is unlikely to be sustained”. EUR briefly touched 1.1507 yesterday before staging a robust recovery. The price action reinforces our view that EUR is not ready to reenter a bearish phase just yet. That said, only a break back above 1.1680 (‘key resistance’ level remains unchanged) would indicate that the current downward pressure has eased. Until then, there is still risk for a dip below 1.1505 but the prospect for such a move is not high now”.