Research Team at UOB, suggest that in view of ECB’s meeting later today, a break out the narrow consolidation range will not be surprising but the direction of the break would be more difficult to determine.
“We adopted a neutral stance in EUR last Friday and since then; this pair has been trading sideways within a range of 1.1304/1.1397.”
“With daily MACD heading lower and with internal momentum showing signs of weakness, the bias appears to be greater on the downside. However, 1.1300 is a major support and this level has to break before a sustained down-move in EUR can be expected in the coming days.”
“That said, the next support is not that far away at 1.1240 and being a cluster of supports, this is clearly a major level. The next significant support below 1.1240 is closer to 1.1085. Overall, a move to 1.1415/20 resistance will not be surprising but at this stage, 1.1460 appears to be strong enough to contain any EUR strength in the next couple of days.”