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According to FX Strategists at UOB Group, the pair’s near term outlook stays bullish/neutral.

Key Quotes

“Italian budget negotiations are in focus as market participants assess the risk of a delay to the 2019 budget plan, given conflicting reports on planned deficit targets. 10Y BTP yields are up 5bpts on the day. ECB rate expectations remain steady and German-U.S. yield spreads have narrowed from their extended levels. Measures of implied volatility are rising and lifting the premium for protection against EUR weakness”.

“Bullish momentum indicators are fading to neutral and the DMI’s are converging. EUR appears to have found near-term support in the 1.1680-1.1700 area and we would anticipate additional support at 1.1650. We continue to highlight the importance of the 1.1780 level representing the first major retracement (38.2%) of the 2018 decline”.