EUR/USD seen testing 1.1265/85 band – UOB

FX Strategists at UOB Group remain neutral on EUR/USD and noted the likeliness of a drop to the 1.1285/65 area in the short-term horizon.

Key Quotes

24-hour view: “EUR dropped to 1.1321 yesterday before recovering slightly. While the underlying tone remains soft and a dip below the 1.1321 low is not ruled out, waning momentum suggests that a clear break of the strong 1.1295 support is unlikely. On the upside, only a move back above 1.1390 would indicate that the current mild downward pressure has eased (minor resistance is at 1.1370)”.

Next 1-3 weeks: “Despite the relatively sharp and rapid drop from last week’s 1.1515 peak, there is no significant improvement in downward momentum. That said, EUR is under mild downward pressure and could drift lower and test the major 1.1265/85 support zone in the coming days. For now, a clear break of these strong levels appears unlikely. Resistance is at 1.1390 but only a move above 1.1420 would indicate the current mild downward pressure has eased”.