EUR/USD keeps the downward bias unchanged – UOB

In opinion of FX Strategists at UOB Group, EUR/USD risks further decline in the next weeks.

Key Quotes

24-hour view: “We highlighted yesterday that EUR ‘could dip below 1.1680 but may not be able to maintain a foothold below this level’. We added, ‘the next support is at 1.1662’. EUR subsequently dropped to 1.1666 before rebounding slightly to close at 1.1681 (-0.11%). Despite the decline, downward momentum has not improved by much and EUR is unlikely to weaken much further. For today, EUR is more likely to consolidate at these lower levels, likely between 1.1660 and 1.1705.”

Next 1-3 weeks: “Yesterday (28 Sep, spot at 1.1695), we highlighted that ‘downward momentum is showing tentative signs of building and a daily closing below 1.1680 would indicate that EUR could break August’s low at 1.1662 and head towards 1.1630’. EUR subsequently dropped to 1.1666 before closing at 1.1681 (-0.11%). While we prefer a weaker daily closing, the price actions suggest that EUR is likely to trade with a downward bias from here. That said, downward momentum still appears to be a bit tentative and the major support at 1.1630 may not come into the picture so soon. On the upside, a break of 1.1745 (no change in ‘strong resistance level from yesterday) would indicate that the current downward bias has eased.”