EUR/USD fragile, now looks to 1.1400 – UOB
|FX Strategists at UOB Group noted the pair looks vulnerable and could test the 1.1400 area in the next weeks.
Key Quotes
24-hour view: “The ‘target’ indicated at 1.1470 yesterday was exceeded as EUR slumped to an overnight low of 1.1447. Downward momentum has improved considerably and from here, a break of last month’s 1.1430 would not surprise at all and the next support at 1.1400 may just come into the picture as well. On the upside, we expect 1.1510 to be strong enough to cap any intraday EUR strength (minor resistance is at 1.1485)”.
Next 1-3 weeks: “We indicated yesterday (18 Oct, spot at 1.1505) EUR could “weaken further in the coming days” but highlighted “strong support is expected at 1.1430”. However, the subsequent decline was more rapid and ‘impulsive’ than expected as EUR plummeted to a low of 1.1447. The price action not only suggests a break of 1.1430 seems likely now but also the next support at 1.1400 is ‘vulnerable’. Looking ahead, a clear break of 1.1400 would be a good indication that EUR could threaten the year-to-date low near 1.1300. All in, we expect EUR to stay on the defensive in the coming days unless it can reclaim 1.1540 (‘key resistance’ was at 1.1590 yesterday)”.
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