EUR/USD: Any advance may be limited to a test of 1.1730 – UOB Group

Euro (EUR) could continue to rebound, but any advance may be limited to a test of 1.1730. Outlook is mixed; for the time being, EUR is likely to trade in a range of 1.1630/1.1755, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

EUR is likely to trade in a range

24-HOUR VIEW: "EUR fell sharply last Thursday. On Friday, we indicated that 'the decline seems excessive, and EUR is unlikely to weaken much further.' We expected EUR to 'trade in a range between 1.1615 and 1.1675.' We did not anticipate EUR to rebound strongly to a high of 1.1715. Today, EUR could continue to rebound, but as there has been no significant increase in upward momentum, any further advance may be limited to a test of 1.1730. Support is at 1.1680, followed by 1.1660."

1-3 WEEKS VIEW: "We revised our view to neutral last Friday (15 Aug, spot at 1.1645). We stated that 'the current price movements are likely part of a consolidation phase between 1.1585 and 1.1705.' We did not expect EUR to rebound to a high of 1.1715. The recent price action, where the buildup in momentum failed to translate into a clear trending move, has resulted in a mixed outlook. For the time being, we expect EUR to trade a in range, likely between 1.1630 and 1.1755."