EUR/USD keeps the neutral bias intact – UOB

The outlook on the pair remains neutral for the time being, while the likelihood of a deeper retracement still stay on the cards, according to FX Strategists at UOB Group.

Key Quotes

24-hour view: “EUR traded between 1.2217 and 1.2290 last Friday, a few pips wider than out expected 1.2220/1.2290 consolidation range. However, the undertone has improved with the strong daily closing and the immediate pressure is tilted to the upside. That said, any advance is unlikely to break clearly above the strong 1.2315 resistance (there is another strong level at 1.2350). Support is at 1.2245 followed by 1.2215. The latter level is likely ‘safe’ for today”.

Next 1-3 weeks: “We highlighted on Wednesday (04 Apr, 1.2275) that the undertone for EUR has weakened and that “a dip below 1.2235 would not be surprising” but “any weakness is expected to encounter solid support” at the March’s low of 1.2153. EUR dipped to a low of 1.2216 yesterday before rebounding. Despite the bounce, the undertone remains weak and the immediate pressure is still on the downside. That said, in view of the lackluster momentum, we continue to expect solid support near 1.2153. In other words, EUR is still on the back foot unless it can move back above 1.2350 (key resistance previously at 1.2420)”.