EUR/USD: Upside Bias, Target 1.1725 – UOB

EUR/USD is trading around 1.17063, maintaining its recent upward bias. UOB strategists Quek Ser Leang and Lee Sue Ann note that supported by a weaker USD and strong momentum, the pair has broken above the three-month high near 1.1680, leaving room for further gains toward 1.1725.

**Short-Term Target and Support Levels Raised**

UOB expects intraday gains to be capped around 1.1700, but the broader upward structure remains intact. Support levels have been raised to 1.1635 and 1.1600 over the next few days. As long as these supports hold, the bullish outlook stays valid. The path of least resistance remains to the upside, with ongoing buying interest in the market.

**Diverging Institutional Views**

However, not all institutions share the same optimism. Morgan Stanley strategists, including David Adams, argue that EUR/USD could easily fall to 1.10, as medium-term investors unwind structural short-USD positions, while speculative flows may add to momentum-driven positioning. JPMorgan has cut its EUR/USD target to 1.10 for mid-2027, while RBC Capital Markets expects that level to be reached by end of next year. Bank of America and Wells Fargo have also lowered their EUR forecasts.

**Risk Factors to Watch**

UOB cautions that the market remains highly sensitive to macroeconomic data releases and policy signals from the European Central Bank and the U.S. Federal Reserve. Any unexpected shift in monetary policy expectations could quickly alter the technical landscape. Should EUR/USD break below key support, it could signal weakening demand and a potential reversal, prompting traders to closely monitor the fate of these support levels.