EUR/USD: Further range trading is likely – UOB Group

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Euro (EUR) is under mild downward pressure; it could dip below 1.0255 but is unlikely to reach the major support at 1.0220. In the longer run, further range trading is likely; decreasing volatility suggests a narrower range of 1.0220/1.0365, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.


EUR is under mild downward pressure


24-HOUR VIEW: " EUR traded in a quiet manner last Thursday, closing largely unchanged at 1.0298. On Friday, when EUR was at 1.0300, we pointed out that 'the price movements still appear to be part of a consolidation phase.' We expected EUR to 'trade in a 1.0270/1.0330 range.' During NY session, EUR swung between 1.0264 and 1.0330 before closing lower by 0.26% at 1.0271. The price action has resulted in a slight increase in downward momentum. Today, EUR could trade with a downward bias. While it could dip below the support at 1.0255, the major support at 1.0220 is likely out of reach. Resistance is at 1.0305; a break above 1.0320 would indicate that the current mild downward pressure has eased."


1-3 WEEKS VIEW: "Our most recent narrative was from last Wednesday (15 Jan, spot at 1.0300), wherein EUR 'has likely entered a range trading phase, and it is likely to trade between 1.0220 and 1.0400 for the time being.' EUR subsequently traded in a range, but given the decreasing volatility, we expect price movements to be confined to a narrower range of 1.0220/1.0365 for now."

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

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