EUR/USD: Set to consolidate with mild rebound risks – OCBC

Euro (EUR) held on to small gains overnight amid USD’s pullback. EUR/USD was last seen at 1.03 levels.

Mild rebound not ruled out in the near term

"On ECB-speaks, Holzmann said it is unclear whether ECB will lower rates again at its upcoming MPC on 30 Jan, as he pointed to “hiccups” in euro area inflation. He highlighted that core inflation is still closer to 3% than to 2% and policymakers have a lot of challenges with regard to energy."

"Daily momentum turned flat while RSI rose from near oversold conditions. Mild rebound not ruled out in the near term. Resistance at 1.0350 (21 DMA), 1.0405 (50% fibo). Support at 1.01, 0.9950 levels (76.4% fibo retracement of 2022 low to 2023 high)."