EUR/USD: Likely to trade between 1.1585 and 1.1705 - UOB Group

The current Euro (EUR) price movements are likely part of a consolidation phase between 1.1585 and 1.1705, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Current price movements are likely part of a consolidation phase

24-HOUR VIEW: "Following EUR's rise to 1.1730 on Wednesday, we indicated yesterday (Thursday), that '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.' However, instead of strengthening further, EUR dropped sharply to a low of 1.1630. The decline seems excessive, and EUR is unlikely to weaken much further. Today, EUR is more likely to trade in a range between 1.1615 and 1.1675."

1-3 WEEKS VIEW: "Two days ago (13 Aug, spot at 1.1675), we indicated the following: '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.' After EUR rose and closed at 1.1704, we indicated yesterday (14 Aug, spot at 1.1705) that '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.' We did not anticipate the sharp pullback that broke below our 'strong support' level at 1.1645 (low of 1.1630). The breach of the 'strong support' indicates that upward momentum has faded. The current price movements are likely part of a consolidation phase between 1.1585 and 1.1705."