In opinion of FX Strategists at UOB Group, EUR/USD could re-test the 1.1945 level in the next weeks.
Key Quotes
24-hour view: “We expected EUR to strengthen yesterday but we were of the view that ‘the major resistance at 1.1870 is likely out of reach’. The subsequent advance exceeded our expectation as EUR rose to 1.1877. For today, strong upward momentum may ‘override’ the current overbought conditions even though a sustained rise above 1.1915 is unlikely. Support is at 1.1845 followed by 1.1820.”
Next 1-3 weeks: “We noted yesterday (06 Apr, spot at 1.1815) that EUR ‘is in a corrective rebound’. We highlighted that ‘in view of the nascent build-up in momentum, any EUR strength is likely limited to 1.1870 for now’. While our expectation for a stronger EUR is correct, the pace of advance has been more rapid than expected (EUR rose to 1.1877 during NY hours). In other words, the rebound in EUR could extend further. The next major resistance is at 1.1945. Overall, EUR is expected to trade with a positive bias as long as it does not move below 1.1770 (‘strong support’ level has moved higher from yesterday’s level of 1.1745). On a shorter-term note, 1.1820 is already quite a strong level.”
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