FX Strategists at UOB Group noted EUR/USD needs to surpass 1.1190 in the very near-term in order to allow for a move to 1.1200 and beyond.
24-hour view: “Expectation for EUR to ‘move above the overnight high of 1.1212’ was incorrect EUR dropped to 1.1093 before recovering. Tuesday’s (03 Mar) peak of 1.1212 is viewed as a short-term top and the current movement is likely the early stages of a consolidation phase. In other words, EUR is expected to trade sideways for today, expected to be within a 1.1080/1.1170 range.”
Next 1-3 weeks: “We have held a positive view in EUR since early last week and our latest narrative from Tuesday (03 Mar, spot at 1.1145) was that EUR ‘is likely to take a breather and consolidate for a couple of days before making a move to the late Dec high of 1.1239’. For now, there is no change to our view even though shorter-term momentum is beginning to wane and unless EUR can move and stay above 1.1190 within these 1 to 2 days, the odds for a move to 1.1239 would diminish quickly. Conversely, a break of 1.1050 (no change in ‘strong support’ level) would suggest that the powerful rally has run its course.”