FX Strategists at UOB Group noted the downward momentum in EUR/USD is expected to remain unchanged so far.
Key Quotes
24-hour view: “EUR traded sideways between 1.1713 and 1.1749 yesterday before closing little changed at 1.1723 (-0.02%). Despite the quiet consolidation, the underlying tone appears to have weakened somewhat. From here, EUR could drift lower but a sustained decline below 1.1700 is unlikely. Resistance is at 1.1740 followed by 1.1755.”
Next 1-3 weeks: “We have expected a weaker EUR for about 2 weeks now. In our latest update from last Friday (17 Sep, spot at 1.1765), we highlighted that ‘strong downward momentum suggests further EUR weakness is likely’ and that ‘the level to focus on is at 1.1725’. EUR plummeted to 1.1698 on Monday (20 Sep) but has since, not been able to make much headway on the downside. Shorter-term downward momentum has waned a tad and while further EUR weakness is not ruled out, the odds for a decline to the August’s low near 1.1665 are not high. However, the weak phase in EUR is deemed intact as long as it does not move above the ‘strong resistance’ level at 1.1775.”
