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The outlook on EUR/USD has improved somewhat and is now seen trading within the 1.1170/1.1380 range in the next weeks.

Key Quotes

24-hour view: “EUR dipped below the bottom of our expected 1.1200/1.1270 range yesterday (low of 1.1183) before snapping back up to 1.1274. Despite the rapid bounce, upward momentum has hardly improved. However, there is room for EUR to edge nearer to 1.1290. For today, 1.1330 is unlikely to be challenged. Support is at 1.1225 followed by 1.1200.”

Next 1-3 weeks: “Looking back, we called for a short-term top on 12 Jun when EUR was trading at 1.1280 and expected EUR to trade between 1.1170 and 1.1380. When EUR moved towards 1.1170, we highlighted that EUR “has to close below 1.1170 before a more sustained weakness can be expected”. The rapid manner by which EUR rebounded from 1.1183 yesterday (01 Jul) suggests that EUR is not ready to move below 1.1170. To look at it another way, EUR could continue to trade between 1.1170 and 1.1380 for a while more.”