EUR/USD: Still room for a test of 1.1800 – UOB

According to FX Strategists at UOB Group, EUR/USD could still visit the 1.1800 level in the next weeks.

Key Quotes

24-hour view: “We highlighted yesterday that ‘upward momentum has improved a tad and while the bias is still on upside, a break of the major resistance at 1.1800 appears unlikely’. Our view was not wrong as EUR rose to 1.1779 before easing off. Upward momentum is beginning to wane and the risk of EUR moving to 1.1800 is slim. The current movement is viewed as part of a consolidation phase and EUR is expected to trade sideways, likely within a 1.1735/1.1775 range.”

Next 1-3 weeks: “Our narrative from Tuesday (24 Aug, spot at 1.1745) still stands. As highlighted, ‘the rebound in EUR has scope to extend to 1.1800’. We added, ‘at this stage, the odds for a sustained advance above 1.1800 are not high’. EUR rose to 1.1779 yesterday (26 Aug) before easing off. Shorter-term upward momentum is beginning to wane but only a break of 1.1705 (no change in ‘strong support’ level) would indicate that 1.1800 is out of reach.”