EUR/USD faces some consolidation within 0.9630-0.9950 – UOB
FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang note EUR/USD is now expected to navigate within 0.9630 and 0.9950 in the next few weeks.
Key Quotes
24-hour view: “We expected EUR to ‘trade sideways between 0.9620 and 0.9750’ yesterday. Our view was incorrect as EUR dropped to 0.9634 before surging higher to close at 0.9814 (+0.82%). EUR extended its advance in early Asian trade. The rapidly improving upward momentum is likely to lead to further advance to 0.9880 before a pullback is likely. The next resistance at 0.9950 is unlikely to come into view. On the downside, a breach of 0.9740 (minor support is at 0.9780) would indicate that the current upward pressure has eased.”
Next 1-3 weeks: “We have held a negative EUR view for more than 2 weeks now. After EUR dropped to 0.9530 and rebounded strongly, we indicated yesterday (29 Sep, spot at 0.9705) that ‘there is still a slim chance for EUR to drop to 0.9500’. EUR subsequently soared and took out our ‘strong resistance’ level at 0.9750. The breach of the ‘strong resistance’ level indicates that the USD weakness has stabilized. EUR appears to have moved into a consolidation phase and is likely to trade between 0.9630 and 0.9950 for now.”