Further upside could motivate EUR/USD to revisit the mid-1.0800s in the next few weeks, note Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: We noted yesterday, “the price actions are likely part of a consolidation” and we expected EUR to “trade between 1.0730 and 1.0775”. After dipping to a low of 1.0731, EUR rebounded to 1.0790 before closing little changed at 1.0757 (+0.09%). Despite the rebound, there is no clear increase in upward momentum. EUR could continue to consolidate for now, likely in a range of 1.0735/1.0800.

Next 1-3 weeks: Our most recent narrative was from last Friday (09 Jun, spot at 1.0780) wherein upward momentum is building tentatively but “it is not clear for now if EUR has enough momentum to rise to 1.0850”. Yesterday (12 Jun), EUR fell to within one pip of our ‘strong support’ level of 1.0730 (low of 1.0731). There is still a slight upward bias but EUR has to break and stay above 1.0800 in the next 1-2 days or the odds for further EUR strength will diminish quickly. Conversely, a breach of 1.0730 (no change in ‘strong support’ level) would suggest the build-up in momentum has faded.