EUR/USD still seen between 1.1740 and 1.1950 – UOB

In opinion of FX Strategists at UOB Group, EUR/USD is expected to keep the trade likely between 1.1740 and 1.1950 in the next weeks.

Key Quotes

24-hour view: “Yesterday, we highlighted that there ‘is room for EUR to weaken further to 1.1805’. We added, ‘for today, the next support at 1.1780 is unlikely to come into the picture’. Our view was not wrong as EUR dipped to 1.1800 before recovering quickly. Despite the rapid bounce from the low, upward momentum has improved just a tad. From here, the rebound could extend to 1.1900 but a sustained rise above this level is unlikely (next resistance is at 1.1925). Support is at 1.1840 followed by 1.1820. The 1.1800 low is likely ‘safe’ for today.”

Next 1-3 weeks: “There is not much to add to the update from yesterday (20 Aug, spot at 1.1845). As highlighted, we view the current price action as the early stages of a consolidation phase. For these couple of weeks, EUR is likely to trade between 1.1740 and 1.1950. In view of the still overbought conditions, the downside risk appears to be greater but EUR has to close below 1.1740 in order to indicate the start of a more sustained and deeper pull-back in EUR.”