Another attempt to boost appeal – OCBC

“Overnight at an event in Berlin, ECB’s Lagarde made another attempt to raise Euro’s profile. She said that ‘The ongoing changes create the opening for a ‘global Euro moment’… This is a prime opportunity for Europe to take greater control of its own destiny. But this is not a privilege that will simply be given to us. We have to earn it’. She also highlighted that there should be more joint financing on the European level for measures including defense. EUR was last seen at 1.1349 levels, OCBC’s FX analysts Frances Cheung and Christopher Wong note.

Bearish momentum on daily chart has faded

“Progress on that front would mean investors would have a deeper pool of securities to tap into. She added that Economic logic tells us that public goods need to be jointly financed, and this joint financing could provide the basis for Europe to gradually increase its supply of safe assets. This is also consistent with Schnabel’s earlier comments that a large European bond market is a prerequisite for a greater role for the Euro.”

“Taken together, Lagarde’s remarks is consistent with her earlier comments in attempting to position the EUR as a credible alternative reserve currency.’ She had earlier said that Euro’s recent appreciation was ‘counterintuitive but justified’, she implicitly acknowledges a shift in global capital preferences – driven not just by macroeconomic fundamentals, but also waning confidence in the US governance and policy predictability. We see room for EUR to go higher but near term, there may a technical risk of a pullback.”

“Bearish momentum on daily chart faded but rise in RSI shows signs of moderation from near overbought conditions. On price action, rising wedge pattern may be forming. This can be associated with a bearish reversal but remains early to concur. We continue to watch price action. Resistance at 1.1420/30 levels. Decisive break puts next resistance at 1.1570 (recent high). Failing which, the pair may revert to trading recent range. Support at 1.1280 (21 DMA), 1.1235 (23.6% fibo retracement of 2025 low to high) and 1.1150 (50 DMA).”