In the opinion of the currency strategists at UOB Group, EUR / USD is now likely to move within the 1.2095 to 1.2245 range.
Key Comments:
24 hour view: “While our view that the EUR / USD ‘could break 1.2240 but is unlikely to challenge the next major resistance at 1.2290’ was correct (the EUR rose to 1.2244), we do not anticipate the sharp decline during the American session that sent the price down. par at 1.2158. The sharp and rapid decline seems over the top, but it has room to prove 1.2145. For today, the next major support at 1.2095 is not expected to enter the picture. Resistance is at 1.2195, followed by 1.2225 “.
Next 1-3 weeks: “We highlighted yesterday that the EUR / USD is still strong and that ‘the next level to focus on above 1.2240 is 1.2290’. Subsequently, the EUR / USD broke the 1.2240 level (high of 1.2244), but made a surprisingly fast and strong selloff during the American session (1.2158 low). While our ‘strong support’ level at 1.2145 is still intact, the rapid loss of momentum suggests that the EUR / USD strength that started earlier this year week has ended earlier than expected. The current move is considered the first phases of a consolidation phase and the EUR / USD is likely to move within a range of 1.2095 / 1.2245 for now. “
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