FX Strategists at UOB Group still see scope for EUR/USD to advance to the 1.1120 area in the near-term.
24-hour view: “We highlighted yesterday ‘there is room for EUR to move above last month’s peak at 1.1096 first before a pull-back can be expected’. The expectation did not materialize as EUR traded in a relatively quiet manner between 1.1064 and 1.1093. The underlying tone still appears to be firm and we continue to see chance for UER to edge above 1.1096. However, the next resistance at 1.1125 is likely out of reach. Support is at 1.1060 but only a move below 1.1040 would indicate that the current upward pressure has eased.”
Next 1-3 weeks: “There is not much to add to our update from yesterday (03 Dec, spot at 1.1075). As highlighted, last Friday’s (29 Nov) low of 1.0979 is an intermediate bottom and EUR is likely to stay above this level for the next 1 to 2 weeks. While it is too early to expect a sustained advance, EUR could test the strong 1.1125 resistance. At this stage, the probability of a sustained rise above this level is not high. Looking forward, a NY closing above 1.1125 would suggest EUR is ready to challenge last month’s peak near 1.1180. All in, EUR is expected to trade with a firm footing and only a break of 1.1020 (no change in ‘strong support’ level) would indicate that the current upward pressure has eased”.
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