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FX Strategists at UOB Group noted that occasional bullish attempts in EUR/USD should meet a tough barrier in the 1.1180 region.

Key Quotes

24-hour view: “Expectation for EUR strength to ‘move above 1.1115’ was incorrect as it dropped briefly to 1.1034 before recovering to end the day lower at 1.1058 (-0.32%). The movement is viewed as part of a consolidation phase. In other words, EUR is expected to trade sideways for today, likely between 1.1035 and 1.1085.”

Next 1-3 weeks: “The rapid manner by which EUR gave up a large part of the strong gains from last Friday (31 Jan) came as a surprise (EUR lost -0.31% yesterday). For now, we are holding on to our view from yesterday (03 Feb, spot at 1.1090) wherein last week’s 1.0990 low is a short-term bottom and the current movement is viewed as a rebound that has scope to extend higher towards the solid resistance at 1.1180. However, a breach of 1.1015 (no change in ‘strong support’ level) would indicate that our expectation for a rebound is premature.”