EUR/USD within a consolidative phase – UOB

The pair stays neutral in the near term and remains poised to extend the current rangebound theme, according to FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected a lower EUR yesterday and anticipated a ‘test’ of the 1.2335 support. EUR dropped to a low of 1.2313 before rebounding strongly. Downward pressure has eased and EUR has likely made a short-term low at 1.2313. The recovery from the low has scope to extend higher but a clear break above yesterday’s top near 1.2435 seems unlikely (next resistance is at 1.2475). On the downside, support is at 1.2340 followed the low near 1.2315 (there is another strong support at 1.2300)”.

Next 1-3 weeks: “We just shifted from a bullish to neutral stance yesterday and there is no change to the view. EUR is deemed to have move into a correction phase and despite the bounce from an overnight low of 1.2313, we continue to see room for a ‘test’ of the 1.2300 support (there is another rather strong level near 1.2250). Only a move back above 1.2475 would indicate that the current mild downward pressure has eased”.