FX Strategists at UOB Group noted that EUR/USD faces further upside if close above the 1.1915 level.
Key Quotes
24-hour view: “We highlighted yesterday that ‘there is room for EUR to edge higher and test the 1.1880 resistance’. We added, for today, ‘a sustained rise above this level is not expected’. Our view was not wrong as EUR rose to a high of 1.1880 before ending the day on a firm note at 1.1869 (+0.24%). While in overbought territory, the advance has room to extend further even though the odds for a sustained rise above the month-to-date high at 1.1915 are not high (next resistance is at 1.1945). Overall, the current upward pressure is expected to remain intact as long as EUR does not move below 1.1835 (minor support is at 1.1855).”
Next 1-3 week: “EUR tested the top of our expected consolidation range of 1.1660/1.1880 yesterday (high of 1.1880). The price action was not surprising as we highlighted yesterday (17 Aug, spot at 1.1845) that ‘while EUR could edge above 1.1880, only a NY closing above 1.1915 would indicate the start of fresh positive phase’. For now, the prospect for EUR to move clearly above 1.1915 is not high but it would increase quickly unless EUR moves and stays below 1.1815 within these few days. Looking forward, if there is a NY closing above 1.1915, EUR could strengthen towards 1.2000.”
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