EUR/USD: The level to monitor is 1.0400– UOB Group
|The Euro (EUR) could break the significant support at 1.0450; the next technical target at 1.0400 is likely out of reach for the time being. In the longer run, EUR weakness has resumed; the levels to monitor are 1.0450 and 1.0400, UOB Group’s FX strategists Quek Ser Leang and Lee Sue Ann note.
EUR weakness has resumed
24-HOUR VIEW: “Our view for EUR to trade in a range yesterday was incorrect, as it plummeted to a low of 1.0461, closing on a weak note at 1.0473 (- 0.66%). The strong momentum is likely to outweigh the oversold conditions. Today, EUR could break the significant support at 1.0450. The next technical target at 1.0400 is likely out of reach for the time being. On the upside, any recovery is expected to remain below 1.0530, with minor resistance at 1.0505.”
1-3 WEEKS VIEW: “Two days ago (20 Nov, spot at 1.0590), we indicated that ‘the weakness in EUR has stabilised.’ We expected EUR to ‘consolidate between 1.0520 and 1.0685.’ After EUR dropped to a low of 1.0507, we pointed out yesterday (20 Nov, spot at 1.0545) that ‘the recent downtrend is likely to resume if it breaks and stays below 1.0490.’ We did not anticipate EUR to break below 1.0490 as quickly, as it plummeted to 1.0461. To look at it another way, the recent EUR weakness has resumed earlier than expected. The levels to monitor are 1.0450 and 1.0400. We will maintain our view provided that 1.0560 (‘strong resistance’ level was at 1.0600 yesterday) is not breached.”
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