EUR/USD: Likely to trade in a range of 1.1600/1.1690 – UOB Group
Euro (EUR) is likely to trade in a range of 1.1600/1.1690. In the longer run, EUR is expected to trade in a range between 1.1580 and 1.1745, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
EUR is expected to trade in a range between
24-HOUR VIEW: "Yesterday, we noted that the sharp rally from last Friday 'appears to be overstretched.' We indicated that 'instead of continuing to rise, EUR is more likely to consolidate between 1.1665 and 1.1745.' The subsequent price action did not turn out as we expected, as instead of consolidating, EUR pulled back sharply to a low of 1.1601. EUR closed at 1.1618, down sharply by 0.83%. The sharp decline appears to be running ahead of itself, and EUR is unlikely to weaken much further. Today, we expect EUR to trade in a range of 1.1600/1.1690."
1-3 WEEKS VIEW: "Although EUR soared last Friday, we highlighted yesterday (25 Aug, spot at 1.1715) that 'the increase in upward momentum is not enough to indicate a sustained rise.' We added, 'for EUR to continue to rise, it must first close above 1.1745.' That said, we did not expect EUR to pull back sharply and break below our ‘strong support’ level at 1.1630 (low of 1.1601). The breach of our ‘strong support’ level indicates that the buildup in upward momentum has fizzled out. From here, we expect EUR to trade in a range, probably between 1.1580 and 1.1745."
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