Euro (EUR) is under moderate down pressure; it might dip listed below 1.0255 however is not likely to reach the significant assistance at 1.0220. In the longer run, more variety trading is most likely; reducing volatility recommends a narrower variety of 1.0220/ 1.0365, UOB Group’s FX experts Quek Ser Leang and Peter Chia note.
EUR is under moderate down pressure
24-HOUR VIEW:” EUR sold a peaceful way last Thursday, closing mainly the same at 1.0298. On Friday, when EUR was at 1.0300, we mentioned that ‘the rate motions still seem part of a debt consolidation stage.’ We anticipated EUR to ‘sell a 1.0270/ 1.0330 variety.’ Throughout NY session, EUR swung in between 1.0264 and 1.0330 before closing lower by 0.26% at 1.0271. The rate action has actually led to a minor boost in down momentum. Today, EUR might trade with a down predisposition. While it might dip listed below the assistance at 1.0255, the significant assistance at 1.0220 is most likely out of reach. Resistance is at 1.0305; a break above 1.0320 would suggest that the existing moderate down pressure has actually reduced.”
1-3 WEEKS VIEW: “Our latest story was from last Wednesday (15 Jan, area at 1.0300), where EUR ‘has most likely went into a variety trading stage, and it is most likely to trade in between 1.0220 and 1.0400 for the time being.’ EUR consequently sold a variety, however provided the reducing volatility, we anticipate rate motions to be restricted to a narrower variety of 1.0220/ 1.0365 in the meantime.”
Source: FXstreet.