UOB Group currency strategists note that EUR / USD bullish momentum remains capped so far by the 1.1870 level.
24 hour view: “The strong rise of the EUR / USD to a high of 1.1819 was a surprise. The rapid advance has room to extend, but in view of already overbought conditions, the main resistance at 1.1870 is likely to be out of reach (1.1845 is already a fairly strong level). Support is at 1.1800 followed by 1.1770 “.
Next 1-3 weeks: “We observed yesterday (Apr 5, EUR / USD at 1.1765) that ‘the odds of EUR / USD moving below 1.1700 have decreased’, but we do not anticipate the strong rebound to a high of 1.1819. While our ‘strong resistance’ level at 1.1825 remains intact, the rapid improvement in short-term bullish momentum indicates that the EUR / USD weak phase that began in late March is over. The current move is considered the early stages of a corrective bounce. In light of the incipient buildup of momentum, any EUR / USD strength is likely to be capped at 1.1870 for now. Overall, the EUR / USD is expected to trade on a positive bias as long as it doesn’t move below 1.1745 in these few days. “