Further gains appear on the cards once EUR/USD surpasses the 1.0930 level, suggest UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia.

Key Quotes

24-hour view: “We expected EUR to decline further but we were of the view that ‘the major support at 1.0755 is unlikely to come under threat’. EUR dropped to 1.0786 in Asian trade and then snapped back up and soared to a high of 1.0916. The rapid advance has scope to rise above the major resistance at 1.0930. In view of the overbought conditions, EUR might not be able to hold above this level. The next resistance at 1.0970 is unlikely to come under threat. Support is at 1.0875, followed by 1.0840.”

Next 1-3 weeks: “Our view from yesterday (03 Apr, spot at 1.0815) wherein ‘the corrective pullback could extend to 1.0755’ was proven incorrect quickly as EUR snapped higher and took out our ‘strong resistance’ level of 1.0890. Despite the rapid rise, it is too early to tell if the recent EUR strength has resumed. EUR has to break and stay above 1.0930 before a sustained advance is likely. The likelihood of a clear break above 1.0930 will remain intact as long as EUR stays above 1.0800 in the next few days. Looking ahead, the resistance levels above 1.0930 are at 1.0970 and 1.1035.”