In the opinion of Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, further upside could now lift EUR/USD to the 1.1120 region in the next few weeks.

Key Quotes

24-hour view: “EUR lifted off during NY trade and surged to a high of 1.1000 before extending its gains in early Asian hours. While the rapid and outsized surge appears to be overdone, the advance is not showing signs of slowing just yet. In other words, further EUR strength is not ruled out. That said, the major resistance at 1.1120 is unlikely to come into view today (there is another resistance at 1.1055). Support is at 1.0975, a break of 1.0940 would indicate that the current strong upward pressure has eased.”

Next 1-3weeks: “We noted on Monday (30 January, spot at 1.0870) that the EUR appears to have entered a consolidation phase and that it is likely to trade between 1.0800 and 1.0930 for the time being. Yesterday, EUR took off and blasted above 1.0930. The consolidation phase has ended quickly and EUR is likely to head higher toward 1.1120. On the downside, a break of 1.0900 (‘strong support’ level) would indicate that USD is not ready to head higher to 1.1120.”