EURUSD: Although EUR turned lower off the 1.3138 level, it still faces its broader upside risk. While it maintains above the 1.2890/22 levels, we think the pair will maintain its upside bias. This suggests it could eventually recapture the 1.3171 level with a breach of here resuming its broader uptrend towards the 1.3282 level. A cut through here will call for a move further higher towards its weekly ema at 1.3415 level. Conversely, the pair will have to break and hold below the 1.2890/22 levels to prevent an eventual return to the 1.3171 level. This 1.2890/22 zone is key as a break and hold below here could put its broader upside bias on hold and bring deeper weakness towards the 1.2755 level. We expect a cap to occur here and possibly turn the pair higher again. If broken, expect further declines to develop towards the 1.2625 level. All in all, EUR faces further upside threats medium term.
