EUR/USD faces some consolidation near term – UOB

UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang note EUR/USD is now seen trading within 1.0560 and 1.0800 in the next weeks.

Key Quotes

24-hour view: “We noted yesterday that ‘upward momentum has improved, albeit not significantly’. We expected EUR to advance further to 1.0740 but we were of the view that the major resistance at 1.0800 is not expected to come under threat. Our view was not wrong as EUR rose to 1.0748, dropped to 1.0649 and then rebounded to close at 1.0729 (+0.81%). While upward momentum has not improved much, EUR is likely to edge higher. However, the major resistance at 1.0800 is still unlikely to come under threat (there is a minor resistance at 1.0770). Support is at 1.0690, a breach of 1.0660 would suggest that the current upward pressure has eased.”

Next 1-3 weeks: “We continue to hold the same view as yesterday (13 Mar, spot at 1.0685). As highlighted, we view the current price actions as part of a consolidation range and expect EUR to trade between 1.0560 and 1.0800 for the time being. That said, the short-term underlying tone appears to be firm and in the next 1-2 days, the risk is for EUR to edge higher and test 1.0800. At this stage, a sustained rise above 1.0800 is unlikely.”