EUR/USD: Still scope for a move to 1.0850 – UOB

The continuation of the upside momentum could encourage EUR/USD to revisit the 1.0850 region in the near term according to UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.

Key Quotes

24-hour view: We expected EUR to consolidate in a range of 1.0735/1.0800 yesterday. However, it rose to a high of 1.0823 and then eased off to close at 1.0791 (+0.32%). Upward momentum has improved, albeit just a tad. Today, there is a chance for EUR to retest the 1.0825 level before a more sustained pullback is likely. The major resistance at 1.0850 is likely out of reach. Support is at 1.0775; if EUR breaks below 1.0750, it suggests the current upward pressure has eased.

Next 1-3 weeks: Our most recent narrative was from last Friday (09 Jun, spot at 1.0780) wherein upward momentum is building tentatively but “it is not clear for now if EUR has enough momentum to rise to 1.0850”. Yesterday (13 Jun), EUR rose to 1.0823 and then eased off. After the advance, upward momentum has improved, but not much. However, the odds of EUR rising to 1.0850 have increased. Overall, only a breach of 1.0730 (no change in ‘strong support’ level) would suggest EUR is not ready to head higher to 1.0850.