EUR/USD now focused on 1.1620 – UOB
|The pair could attempt a test of 1.1700 if 1.1620 is cleared, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “While we held the view last Friday that “overbought conditions could limit EUR gains to 1.1620”, the swift and rapid pull-back from a high of 1.1610 was not exactly expected. The 1.1610 high is deemed as a short-term top and the current movement is viewed as part of a consolidation phase. From here, we expect EUR to trade sideways to slightly lower, likely within a 1.1525/1.1585 range”.
Next 1-3 weeks: “EUR touched a high of 1.1610 last Friday, not far from the strong 1.1620 resistance highlighted in recent updates. The subsequent swift drop from the high was not exactly expected but as pointed out earlier last Friday (12 Oct, spot at 1.1590), only a break of the ‘key support’ at 1.1500 would indicate that a short-term top is in place. Until then, neutral short-term indicators could lead to a couple of days of consolidation but the overall ‘positive’ outlook is deemed as intact until 1.1500 is taken out. In other words, there is still chance that EUR could break above 1.1620 and this would suggest scope for further EUR strength towards 1.1700”.
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