EUR/USD: Diminishing probability of a breach of 1.0750 – UOB

Pablo Piovano FXStreet

Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group suggest the likelihood of EUR/USD breaking below 1.0750 on a sustainable fashion has lost some momentum.

Key Quotes

24-hour view: “We indicated yesterday that ‘the current price movements are likely part of a consolidation phase’ and we expected EUR to trade sideways between 1.0785 and 1.0845. Our view of sideways trading was correct even though EUR traded in a narrower range than expected (1.0794/1.0831). The price movements offer no fresh clues and we continue to expect EUR to trade sideways between 1.0785 and 1.0845.”

Next 1-3 weeks: “Our update from yesterday (22 May, spot at 1.0820) still stands. As highlighted, the likelihood of EUR breaking clearly below 1.0750 has diminished. However, only a break above 1.0860 (no change in ‘strong resistance’ level) would indicate the EUR weakness that started more than a week ago has stabilized. In order not to lose further momentum, EUR has to break and stay below 1.0785 in the next 1-2 days or a breach of the ‘strong resistance’ at 1.0860 will not be surprising.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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