FX Strategists at UOB Group noted the pair could drop and test the 110.60 region in the short-term horizon.
24-hour view: “USD rebounded quickly after touching a low of 110.68 early yesterday. The current movement is viewed as part of a consolidation phase and USD is expected to trade sideways for today, likely within a 110.80/111.50 range”.
Next 1-3 weeks: “USD dipped to a low of 110.68 yesterday before rebounding quickly. The low was just above the bottom of our expected 110.60/112.20 consolidation range. Despite the bounce, the underlying tone has weakened and from here, the risk for a break of 110.60 has increased. A break of 110.60 would suggest USD is ready to probe the next support at 110.25. On the upside, only a break of 111.80 would indicate that the current mild downward pressure has eased”.
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