According to FX Strategists at UOB Group, EUR/USD risks extra pullbacks in the next weeks.
24-hour view: “We highlighted yesterday that ‘the risk for EUR is still on the downside even though the major support at 1.1200 is still unlikely to come into the picture’. We added, ‘there is a minor support at 1.1220.’ EUR subsequently dipped to 1.1224 before recovering to trade sideways. Downward pressure is beginning to ease and EUR has likely moved into a consolidation phase. In other words, EUR is likely to trade sideways for today, expected to be within a 1.1225/1.1275 range.”
Next 1-3 weeks: “Our view from two days ago (22 Nov, spot at 1.1285) still stands. As highlighted, further EUR weakness is likely but oversold conditions suggest that 1.1200 may not come into the picture so soon. All in, EUR is expected to stay under pressure as long as it does not move above 1.1325 (no change in ‘strong resistance’ level). Looking ahead, a break of 1.1200 would shift the focus to 1.1160.”