FX Strategists at UOB Group now see the pair entering into a consolidative theme in the near term.
Key Quotes
24-hour view: “We expected EUR to test 1.1535 yesterday but were of the view that “the next resistance at 1.1560 is likely out of reach”. In line with expectation, EUR rose to a high of 1.1545 before easing off. The underlying tone remains positive and we see chance for a test of 1.1560 from here. At this stage, the probability for a sustained up-move above this level is not high (next resistance is at 1.1590). Support is at 1.1500 followed by 1.1575″.
Next 1-3 weeks: “EUR briefly dipped to a low of 1.1477 during London hours yesterday before rebounding strongly. The price action reinforces our view wherein Tuesday’s (09 Oct) low of 1.1429 is deemed as a short-term bottom. As highlighted yesterday (10 Oct, spot at 1.1500), while the overall outlook remains as neutral, EUR is expected to trade sideways to slightly higher in the coming days. That said, after the bounce yesterday, EUR appears more likely to move towards the top of the expected 1.1450/1.1620 consolidation range first. In view of the lackluster momentum, the prospect for a clear break above 1.1620 is not high”.
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