FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang see EUR/USD facing extra downside on a close below 1.0470.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the current movement appears to be part of a consolidation’ and we expected EUR to ‘trade sideways within a range of 1.0490/1.0585’. EUR subsequently traded between 1.0493 and 1.0592 before closing little changed at 1.0555 (+0.04%). We continue to view the price actions as part of a consolidation and expect EUR to trade sideways, albeit within a higher range of 1.0510/1.0610.”

Next 1-3 weeks: “Our latest narrative was from last Friday (06 May, spot at 1.0540) where EUR has to close below the solid support at 1.0470 before a sustained decline is likely. Since then, EUR has not been able to make any headway on the downside as it traded sideways the past few days. As long as 1.0640 is not breached, there is still chance, albeit not a high one for EUR to close below 1.0470.”