The currency strategists of UOB Group noted that further gains are expected in EUR / USD once the 1.2000 / 10 band is broken.
24 hour perspective: “We expected the EUR to trade sideways between 1.1935 and 1.1985 last Friday. However, the euro traded within a higher than expected range (1.1949 / 1.1994). It would not be surprising if more side trades occurred despite about what weakened underlying tone suggests lower trading range of 1.1935 / 1.1985”.
Next 1-3 weeks: “Our latest narrative was from last Thursday (April 15, even at 1.1980) where we highlighted that short-term overbought conditions could slow the pace of advance, but a breakout of 1.2010 would not be surprising. However, 1.2010 remains intact. as the EUR struggled to move above 1.2000 for the past few days, conditions remain overbought and bullish momentum is beginning to wane. Unless the Euro breaks clearly above 1.2000 / 1.2010 in these two days, the possibility of a stronger EUR would diminish rapidly.. Conversely, a break of 1.1915 (unchanged from the ‘strong support’ level) would indicate that the EUR strength that started about 2 weeks ago has come to an end. “
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