EUR/USD risks further declines – UOB

Pablo Piovano FXStreet

In opinion of FX Strategists at UOB Group, the downside pressure in EUR/USD has picked up pace and could recede to 1.1170 in the next weeks.

Key Quotes

24-hour view: “Our view for EUR to ‘trade sideways’ was incorrect as it popped to a high of 1.1288 during London hours. The advance was however, short-lived as EUR dropped quickly to 1.1217 before bouncing back up. The choppy swings have resulted in a mixed outlook. For today, EUR could continue to trade in a choppy manner, likely within a broad 1.1200/1.1280 range.”

Next 1-3 weeks: “We highlighted last Friday (26 Jun, spot at 1.1220) that ‘downward pressure has ticked up but EUR has to close below 1.1170 before a more sustained decline can be expected’. We added, ‘the prospect for such a move is not high but it would continue to increase unless EUR moves and stays above 1.1300 within these 1 to 2 days’. EUR popped to a high of 1.1288 yesterday (29 Jun) before easing off quickly. Downward pressure has eased somewhat but only a break of 1.1300 would indicate that the downside risk has dissipated (and that EUR is still trading in a broad 1.1170/1.1380 range). In other words, there is no change in our view from last Friday.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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