United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report EUR/USD closed near 1.1200 after a volatile session that failed to generate fresh directional clues. For the day, they expect a 1.1180–1.1230 range. On a 1–3 week horizon, they retain a mildly negative stance, seeing a chance of a test of 1.1145 while capping rebounds below 1.1255 strong resistance.

Mildly negative bias with capped rebounds

“24-HOUR VIEW: After EUR rebounded and closed at 1.1209 last Thursday. On Friday, when it was at 1.1215, we indicated that “the recovery could extend but with no clear increase in upward momentum, any advance is likely to stay within a 1.1190/1.1240 range.” EUR subsequently rose to 1.1243, declined to 1.1187 before settling at 1.1201 (-0.07%). The price action provides no fresh clues. Today, EUR could trade between 1.1180 and 1.1230.”

“1-3 WEEKS VIEW: We turned negative on EUR about one month ago (see annotations in the chart below). In our most recent narrative from last Thursday (08 Oct, spot at 1.1200), we highlighted that “downward momentum remains lackluster.” However, we indicated that “there is a chance for EUR to test 1.1145.” EUR has not been able to make much headway on the downside since then, but we will maintain our view as long as the ‘strong resistance’ at 1.1255 (level previously at 1.1265) continues to hold.”