According to FX Strategists at UOB Group, EUR/USD has now likely moved into a 1.1770-1.1895 range in the next weeks.
Key Quotes
24-hour view: “Our expectation for EUR to ‘weaken to 1.1740’ yesterday was incorrect as it tested the 1.1770 level again before rebounding strongly (high has been 1.1838). The rapid rebound appears to be running ahead of itself and EUR is unlikely to strengthen much further. For today, EUR is more likely to trade sideways between 1.1800 and 1.1870.”
Next 1-3 weeks: “Yesterday (14 Jul, spot at 1.1775), we highlighted that EUR ‘has moved into a negative phase’ and we expected EUR to ‘trade under pressure unless it can move above the ‘strong resistance’ level at 1.1840’. We did not anticipate the sharp and rapid bounce that touched a high of 1.1838 during late NY session. While 1.1840 is still intact, the rapid loss in downward momentum indicates that EUR is not ready to head lower just yet. From here, EUR is likely trade between 1.1770 and 1.1895 for a period of time.”
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