The pair’s stance remains neutral in the near term while it keeps focused on a breakout of 1.1620, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “Instead of trading sideways (as expected yesterday), EUR retested the 1.1610 level but eased off after touching a high of 1.1606 (last Friday’s high has been 1.1609). Upward momentum is lackluster at best but there is chance EUR could attempt to break 1.1610 one more time. That said, there is another near-by resistance at 1.1620 and at this stage, the prospect for a sustained break above this level is not high (next resistance is at 1.1650). Support is at 1.1560 but only a break of 1.1545 would indicate the current mild upward pressure has eased”.
Next 1-3 weeks: “EUR touched a high of 1.1606 yesterday, holding just a few pips below last Friday’s 1.1610 peak before easing off to close slightly higher (NY close of 1.1577, +0.12%). The price action is not surprising as we noted yesterday (15 Oct, spot at 1.1555), “neutral short-term indicators could lead to a couple of days of consolidation”. As highlighted, there is still chance that EUR could break above 1.1620 and this would suggest scope for further EUR strength towards 1.1700. Only a break of 1.1520 (‘key support’ previously at 1.1500) would indicate that the current upward pressure has eased”.
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