Euro (EUR) might rebound additional vs US Greenback (USD), however any advance is probably going half of a better vary of 1.1125/1.1225. Within the longer run, EUR stays underneath stress, however it stays to be seen if the present corrective pullback can attain 1.0945, UOB Group’s FX analysts Quek Ser Leang and Peter Chia observe.
EUR stays underneath stress
24-HOUR VIEW: “Two days in the past, EUR plunged by 1.42% to shut at 1.1087. Yesterday, when it was at 1.1095, we famous that ‘the sharp and swift selloff is deeply oversold.’ Nonetheless, we identified, ‘With no indicators of stabilisation simply but, there may be scope for USD to weaken additional, however any decline is unlikely to interrupt the foremost help at 1.1055.’ We had been incorrect. As a substitute of weakening, EUR rebounded to a excessive of 1.1194. Whereas EUR might rebound additional as we speak, any advance is probably going half of a better vary of 1.1125/1.1225. To place it one other approach, any advance is unlikely to interrupt clearly above 1.1225.”
1-3 WEEKS VIEW: “Final Friday (09 Might, spot at 1.1220), we indicated that ‘buildup in momentum signifies additional declines in EUR towards 1.1145.’ After EUR plummeted on Monday, we highlighted yesterday (13 Might, spot at 1.1095) that EUR “stays underneath stress, however it stays to be seen if the present corrective pullback can attain 1.0945.’ We proceed to carry the identical view, however after the following rebound, the chance of EUR pulling again additional to 1.0945 has decreased. Conversely, a break above 1.1225 (no change in ‘robust resistance’ degree from yesterday) would imply that EUR has entered a consolidation part.”
