Euro: Range phase caps recent advance against US Dollar – UOB

United Overseas Banks (UOB) Quek Ser Leang and Lee Sue Ann report EUR/USD held near 1.1650 after a brief dip, with intraday action lacking strong downside momentum. They judge the earlier bullish phase has faded after a break of strong support at 1.1640, shifting to a range between 1.1600 and 1.1685 in the coming days. Longer term, they still flag upside targets at 1.1800 and 1.1850.

Bullish bias cools into consolidation band

“24-HOUR VIEW: EUR dipped to a low of 1.1636 yesterday before recovering to close largely unchanged at 1.1651 (+0.02%). The decline did not result in a significant increase in downward momentum. Today, EUR is likely to trade in a range, probably between 1.1630 and 1.1665.”

“1-3 WEEKS VIEW: We turned positive on EUR early last week (as annotated in the chart below). In our most recent narrative from last Thursday (20 Aug, spot at 1.1675), we highlighted that ”there is room for further upside in EUR toward 1.1725.“ Yesterday, EUR fell and broke below our ‘strong support’ level at 1.1640. The breach of our ‘strong support’ indicates that upward momentum has eased. EUR appears to have entered a range-trading phase. For the time being, it is likely to trade between 1.1600 and 1.1685.”