EUR/USD: Expected to consolidate in a range of 1.1495/1.1600 – UOB Group

Euro (EUR) is expected to consolidate in a range of 1.1495/1.1600. EUR surged to 1.1631 last Thursday. In the longer run, upward momentum has slowed somewhat; a breach of 1.1480 would suggest EUR may trade in a range instead of rising further, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Upward momentum has slowed somewhat

24-HOUR VIEW: "On Friday, when EUR was at 1.1595, we highlighted the following: 'Conditions are deeply overbought, and while EUR may rise above 1.1631, any further advance is likely part of a higher range of 1.1530/1.1640.' The subsequent price movements did turn out as we expected, as EUR pulled back sharply to 1.1488 before rebounding to close down by 0.27% at 1.1552. Upward momentum is turning flat, and today, we expect EUR to consolidate in a range of 1.1495/1.1600."

1-3 WEEKS VIEW: "Last Thursday (12 Jun, spot at 1.1495), we revised our EUR outlook to positive, but we indicated that 'it is too early to tell if there is enough momentum for EUR to reach last month’s high, near 1.1575.' After EUR soared above 1.1575, we indicated on Friday (13 Jun, spot at 1.1595) that EUR 'is likely to continue to rise, and the levels to watch are 1.1640 and 1.1700.' We added, 'if EUR were to break below 1.1480 (‘strong support’ level), it would indicate that the immediate upward pressure has eased.' We did not expect EUR to pull back sharply to 1.1488. Upward momentum has slowed somewhat, and a breach of 1.1480 would suggest that EUR may trade in a range instead of rising further."