EUR/USD: There is scope for EUR to rise toward 1.1755 – UOB Group

Further Euro (EUR) strength is not ruled out; any advance is unlikely to threaten the resistance at 1.1755. In the longer run, price action suggests there is scope for EUR to rise toward 1.1755, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

EUR strength is not ruled out

24-HOUR VIEW: "We expected EUR to 'consolidate in a range of 1.1645/1.1705' yesterday. Instead of consolidating, EUR rose to a high of 1.1730 before easing to close at 1.1704. Further EUR strength is not ruled out, but overbought conditions and a tentative slowing of upward momentum suggest any advance is unlikely to threaten the resistance at 1.1755. Support is at 1.1685; a breach of 1.1670 would indicate that EUR is likely to range trade instead of continuing to strengthen."

1-3 WEEKS VIEW: "We revised our stance from positive to neutral two days ago (12 Aug, spot at 1.1615), indicating that EUR 'has likely entered a consolidation phase, and it is likely to trade between 1.1540 and 1.1685.' After EUR rose to a high of 1.1697, we highlighted the following yesterday (13 Aug, spot at 1.1675): 'Upward momentum is starting to build again, but at this time, it is not enough to suggest a sustained rise. For a continued advance, EUR must first close above 1.1705. The probability of EUR closing above 1.1705 will remain in place provided that the ‘strong support’ level, currently at 1.1615 holds.' EUR subsequently closed at 1.1704, up by 0.27%. Although we would have preferred a more decisive close above 1.1705, the price action suggests there is scope for EUR to rise toward 1.1755. On the downside, the ‘strong support’ level is now at 1.1645 instead of 1.1615."