EUR/USD looks consolidative in the near term – UOB

UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia suggest EUR/USD could now trade between 1.0800 and 1.0930 in the next few weeks.

Key Quotes

24-hout view: “We expected EUR to ‘consolidate between 1.0855 and 1.0925’ last Friday. However, EUR dropped to 1.0835 before rebounding to close at 1.0867 (-0.20%). Despite the decline, downward momentum has barely improved and EUR is unlikely to weaken further. Today, EUR is more likely to trade sideways, expected to be within a range of 1.0840/1.0900.”

Next 1-3 weeks: “Our latest narrative was from last Thursday (26 Jan, spot at 1.0920) when we highlighted that while upward momentum has not improved much, EUR appears poised to head higher toward 1.1000. On Friday, EUR dropped below our ‘strong support’ level of 1.0840. The breach of the ‘strong support’ indicates the mild upward pressure has eased. EUR appears to have entered a consolidation phase and it is likely to trade between 1.0800 and 1.0930 for the time being.”