EUR/USD now moved into a consolidative phase – UOB
|According to FX Strategists at UOB Group, EUR/USD is now seen navigating the 1.1795-1.1895 range.
Key Quotes
24-hour view: “Our expectations for EUR to ‘trade sideways’ yesterday was incorrect and it fell to 1.1836 before closing on a soft note at 1.1839 (-0.24%). Despite the relatively sharp decline, downward momentum has not improved by much. That said, there is room for EUR to weaken to 1.1820. The major support at 1.1795 is not expected to come into the picture. Resistance is at 1.1860 followed by 1.1875.”
Next 1-3 weeks: “We have held a positive view in EUR for 2. In our latest narrative from Monday (06 Sep, spot at 1.1885), we indicated that ‘while overbought shorter-term conditions could lead to a couple of days of consolidation first, a clear break of the major resistance at 1.1910 would not be surprising’. We added, ‘the prospect for the current EUR strength to extend to 1.1970 is not high’. However, 1.1910 remains intact as EUR dropped sharply to 1.1836 during NY session. While our ‘strong support’ level at 1.1830 is still intact, upward momentum has dissipated. In other words, the 2-week EUR strength has run its course. The current movement is viewed as the early stages of a consolidation phase and EUR is likely to trade between 1.1795 and 1.1895 for now.”
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