According to economist Lee Sue Ann and market strategist Quek Ser Leang of UOB group, the EUR/USD needs to break above the 1.0050 level to allow for a sustained rally.
24 hour outlook: “Yesterday we highlighted that the euro could strengthen further, but it remained to be seen if it could break the solid resistance at 1.0050.” However, 1.0050 was not seen as the Euro fell sharply to as low as 0.9833 in New York trade before bouncing back. The upward pressure has subsided and the euro seems to have entered a consolidation phase, being likely to trade between 0.9835 and 0.9960.”
Next 1-3 weeks: “Yesterday (Oct 05, pair at 0.9985), we indicated that, although the risk for the euro had shifted to the upside, the euro ‘has to overcome the important and solid resistance of 1.0050 before a new sustained advance.” Subsequently, the single currency fell sharply and moved a couple of points below our strong support at 0.9835 (low 0.9833). We remain of the same opinion for now, but a break of 0.9800 would indicate that the euro is not ready to rise to 1.0050“.
Source: Fx Street
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