FX Strategists at UOB Group noted EUR/USD is expected to meet the next resistance at 1.2145 in the next weeks.
24-hour view: “We highlighted yesterday that ‘upward momentum has waned and this coupled with still overbought conditions suggest EUR is unlikely to strengthen further’ and we expected EUR to ‘consolidate and trade between 1.2050 and 1.2105’. While our view for consolidation was not wrong, EUR subsequently traded within a narrower range than expected (1.2055/1.2092). The underlying tone has softened somewhat and this could lead to EUR drifting lower to 1.2050. Barring a sudden surge in downward momentum, the next support at 1.2020 is unlikely to come under threat. On the upside, 1.2115 is a solid resistance.”
Next 1-3 weeks: “There is not much to add to our update from yesterday (27 Apr, spot at 1.2080). As highlighted, ‘overbought shorter-term conditions could lead to a couple of days of consolidation first’. As long as EUR does not break 1.2020 (no change in ‘strong support’ level), the positive phase that started 3 weeks ago is deemed as intact. The next resistance levels above 1.2115 are at 1.2145 and 1.2185.”