UOB Group currency strategists note that EUR / USD faces a mixed outlook for now.
Key Comments:
24 hour view: “We expected EUR / USD to strengthen last Friday, but we are of the opinion that EUR / USD was unlikely to ‘break through strong resistance at 1.2125’. The sharp rally that sent EUR / USD to a high of 1.2143 was a surprise. While the rapid rise appears to be ahead of itself, there is room for EUR / USD to move further, but a breakout of last week’s high near 1.2170 is not expected (1.2150 is already quite a strong level). It is at 1.2100 followed by 1.2080 “.
Next 1-3 weeks: “After the EUR / USD fell sharply to 1.2021, we highlighted last Thursday (February 18, EUR / USD at 1.2045) that ‘the bias for the EUR / USD has shifted lower towards 1.2000’. believes that EUR / USD is “under pressure unless it can pull back above 1.2125”. Our view was incorrect as EUR / USD spiked to a high of 1.2143 last Friday. Sharp but short-lived price action it has led to mixed outlook. From here on, the EUR / USD is expected to move between 1.2050 and 1.2200 over a period of time. “
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