FX Strategists at UOB Group noted EUR/USD is still seen within the 1.1760-1.1920 range in the next weeks.
Key Quotes
24-hour view: “We highlighted yesterday that ‘further choppy price actions are not ruled but overall, EUR is likely to stay within yesterday’s broad range of 1.1799/1.1905’. Our view was not wrong as EUR rose 1.1895, dropped to 1.1835 before snapping back up. Upward momentum is beginning to improve and the risk is tilted to the upside. That said, it is left to be seen if EUR can break the solid resistance at 1.1920. Looking ahead, a break of 1.1920 could potentially trigger further buying towards the next resistance at 1.1955. All in, the current outlook for EUR appears to be positive and only a breach of 1.1840 would indicate that the upside risk has dissipated. Minor support is at 1.1860.”
Next 1-3 weeks: “One week ago (17 Nov, spot at 1.1860), we indicated that ‘upward momentum has improved slightly but EUR has to close above 1.1920 in order to indicate that it has moved out of its consolidation phase’. As EUR struggles to move higher, we noted last Friday (20 Nov) that ‘there is still chance for EUR to make a push above 1.1920’. EUR rose to a high of 1.1905 yesterday (23 Nov) before selling off suddenly to a low of 1.1799. While our ‘strong support’ level at 1.1790 is still intact, the rapid loss in momentum suggests that EUR is not ready to move above 1.1920 just yet. From here, EUR could trade sideways for a period of time and only a break out of the expected 1.1760/1.1920 range would indicate the start of a more sustained directional movement.”
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