EUR/USD upside now targets 1.2500 – UOB

In view of FX Strategists at UOB Group, the up move in spot could re-visit the 1.2500 neighbourhood in the near term.

Key Quotes

24-hour view: “The anticipated extension to 1.2465 did not materialize as EUR eased off quickly after touching a high of 1.2443. While upward pressure has clearly eased, it is too soon expect to expect a sustained pullback. EUR is more likely to consolidate at these higher level and trade sideways for now. Expected range for today; 1.2375/1.2445”.

Next 1-3 weeks: “When we turned neutral two days ago (05 Mar, spot at 1.2335), we viewed EUR’s strength as a ‘correction’ but were of the view that the immediate bias is for a ‘probe’ higher towards the top of the expected 1.2220/1.2430 consolidation range. EUR touched an overnight high of 1.2420 and ended the day on a solid note. The undertone has improved considerably and the current EUR strength has room to extend further towards 1.2500. This level is expected to offer solid resistance. At this stage, the odds for a move above last month’s 1.2555 peak are deemed as low. Overall, after the strong advance yesterday, we expect EUR to stay underpinned (at least for the next several days) and only a move back below the key support at 1.2300 would indicate that the immediate upward pressure has eased (minor support is at 1.2350)”.