Euro (EUR) is expected to trade in a 1.0450/1.0505 range vs the US Dollar (USD). In the longer run, rejuvenated upward momentum suggests EUR could continue to advance; the levels to monitor are 1.0530 and 1.0560, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Levels to monitor are 1.0530 and 1.0560
24-HOUR VIEW: “After EUR soared last Thursday, we indicated on Friday, when EUR was at 1.0500, that ‘while deeply overbought, the impulsive advance has room to extend to 1.0530.’ We added, ‘given the overbought conditions, a clear break above this level appears unlikely.’ EUR rose less than expected to 1.0505 and then dropped from the high. The current price movements are likely part of a range trading phase. Expected range for today: 1.0450/1.0505.”
1-3 WEEKS VIEW: “Last Friday (21 Feb, spot at 1.0500), we highlighted that ‘the rejuvenated upward momentum suggests EUR could continue to advance.’ We pointed out, ‘there are a pair of major resistance levels at 1.0530 and 1.0560.’ While we did not expect the sharp pullback, only a breach of 1.0425 (no change in ‘strong support’ level) will invalidate our view.”
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