Spot could break above the 1.1700 handle in the next weeks and advance to the 1.1730 region, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “Expectation for EUR to test the strong 1.1730 resistance last Friday did not materialize as it eased off quickly after touching a high of 1.1717. Upward pressure has clearly eased and the current movement is viewed as part of a consolidation phase. In other words, we expect EUR to trade sideways from here, likely within a 1.1630/1.1700 range”.
Next 1-3 weeks: “The ‘stop-loss’ for our bearish view at 1.1730 remains intact as EUR eased off after touching a high of 1.1717 last Friday. However, as highlighted in recent updates, the odds for EUR weakness have diminished. The current short-term consolidation phase appears to be more akin to a ‘basing process’ (for a recovery) instead of a preparing for further sustained weakness. In order to revive the current flagging downward momentum, EUR has to move and stay below of 1.1600 soon or a break of 1.1730 would not surprise at all”.
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