UOB Group currency strategists have noted that the currency is expected to EUR / USD focus above 1.2000 level if 1.1980 is exceeded In the next weeks.
Key Comments:
24 hour view: “Our expectation for the EUR ‘to move within a 1.1880 / 1.1935’ range was incorrect as the pair spiked to a high of 1.1964 before closing on a firm tone at 1.1962 (+ 0.41%). Momentum Bullish is strong and EUR / USD is likely to continue to advance. A breakout of 1.1980 would not be surprising even though the yearly high at 1.2011 might be out of reach for now. Support is at 1.1940 followed by 1.1920 “.
Next 1-3 weeks: “Last Thursday (Nov 26, EUR / USD at 1.1915), we held the view that the EUR is expected to ‘strengthen, but any advance is likely to be slow and 1.1980 will not enter the scene so soon.’ While our view of a higher EUR / USD was not wrong, the pace at which the pair is approaching 1.1980 is faster than expected. From here, a breakout of 1.1980 would shift focus towards the yearly high at 1.2011. A breakout of this rather critical level could possibly lead to a rapid rise towards the next resistance at 1.2060. On the other hand, only a breakout of 1.1900 (previously ‘strong support’ at 1.1840) would indicate that the risk of further EUR / USD strength has dissipated. “
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