UOB Group currency strategists note that EUR / USD is expected to find the next resistance at 1.2145 In the next weeks.
Key Comments:
24 hour view: “We highlighted yesterday that ‘the bullish momentum has subsided and this, coupled with the still overbought conditions, suggests that EUR / USD is unlikely to strengthen further’ and we expected EUR / USD ‘to consolidate and trade between 1.2050 and 1.2050. 1.2105. ‘While our view of the consolidation was not wrong, the EUR / USD subsequently traded within a tighter range than expected (1.2055 / 1.2092). The underlying tone has softened somewhat and this could lead to EUR / USD falls to 1.2050. Barring a sudden increase in bearish momentum, the next support at 1.2020 is unlikely to be threatened. On the upside, 1.2115 is solid resistance. “
Next 1-3 weeks: “There is not much to add to our update yesterday (April 27, EUR / USD at 1.2080). As highlighted, ‘short-term overbought conditions could lead to a couple of days of consolidation first.’ As long as the EUR / USD does not break 1.2020 (no change at the ‘strong support’ level), the positive phase that started 3 weeks ago is considered intact. The next resistance levels above 1.2115 are at 1.2145 and 1.2185 ”.
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