There may be scope for the sharp rally to increase; deeply overbought circumstances recommend any advance is probably going half of a better vary of 1.1330/1.1415. Within the longer run, improve in momentum isn’t sufficient to point a sustained advance; EUR is prone to commerce in a variety of 1.1270/1.1435 for now, UOB Group’s FX analysts Quek Ser Leang and Peter Chia be aware.
There may be scope for the sharp rally to increase
24-HOUR VIEW: “EUR plunged within the early Asian session yesterday. When EUR was at 1.1245, we highlighted that ‘additional weak point isn’t dominated out, however the sharp drop appears extreme, and it’s unclear whether or not EUR can break and maintain under 1.1200.’ Nonetheless, reasonably than weakening, EUR surged, reaching a excessive of 1.1384 within the late NY session. The sharp rally has scope to increase, however given the deeply overbought circumstances, any advance is probably going half of a better vary of 1.1330/1.1415. To place it one other manner, EUR is unlikely to interrupt clearly above 1.1415.”
1-3 WEEKS VIEW: “The next are excerpts from our replace yesterday: ‘To proceed to say no, EUR should first shut under 1.1200. The danger of EUR closing under 1.1200 will stay intact supplied that the ‘sturdy resistance’ degree, at the moment at 1.1355, isn’t breached.’ EUR by no means threatened 1.1200 (low of 1.1209). As a substitute, it reversed all of its early Asian session selloff, surging to shut at 1.1371 in NY, up 0.70%. Though the sharp rally has gathered some momentum, it’s not sufficient to point a sustained advance simply but. To rise in a sustained method, EUR should first break and maintain above 1.1435. In the meantime, we anticipate EUR to commerce in a variety of 1.1270/1.1435.”
