FX Strategists at UOB Group noted the outlook on EUR/USD remains mixed for the time being.
Key Quotes
24-hour view: “We highlighted yesterday that the ‘rebound in EUR has room to extend higher but a sustained break of 1.0855 is unlikely’. EUR subsequently rose to 1.0861 before retreating. Upward momentum has eased and EUR has likely moved into a consolidation phase. In other words, EUR is expected to trade sideways for today, likely between 1.0790 and 1.0855.”
Next 1-3 weeks: “We have held the same view since 16 Apr (spot at 1.0890) wherein ‘the outlook is mixed’ and EUR could ‘continue to trade in an undecided manner within a broad 1.0750/1.1000 range for a period’. When EUR moved towards the bottom of our expected range at 1.0750, we indicated last Friday (24 Apr, spot at 1.0780) that only “a NY closing below 1.0720 would suggest EUR could weaken further to 1.0635”. EUR subsequently dipped to 1.0725 before staging a robust rebound. Downward pressure has eased and the outlook for EUR remains mixed for now. From here, EUR could continue to trade in an undecided manner and a 1.0725/1.0940 range is likely wide enough to contain the movement in EUR for a while more.”
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