Euro: Support at 1.1565 watched against US Dollar – UOB

FXStreet Insights Team FXStreet

UOB’s Quek Ser Leang highlights that EUR/USD slipped to 1.1568 before rebounding to close near 1.1598, with downside momentum still limited. Intraday, the Euro (EUR) is expected to test major support at 1.1565 but a clear break is seen as unlikely, with resistance at 1.1605 and 1.1620. On a 1–3 week horizon, a close below 1.1585 would raise odds of 1.1565 giving way.

Downside risk but limited momentum

"24-HOUR VIEW: EUR declined to a low of 1.1591 last Thursday. When it was at 1.1610 in the early Asian session on Friday, we stated that “downward momentum is increasing, albeit not significantly.” We held the view that EUR “could test the major support at 1.1585,” but we pointed out that “based on the prevailing momentum, a continued decline below this level appears unlikely.” While EUR fell more than expected to 1.1568, it rebounded quickly to close at 1.1598, down by 0.10%. Although there has been no significant increase in downward momentum, there is scope for EUR to test the major support at 1.1565. A clear break below this level appears unlikely. Resistance is at 1.1605, followed by 1.1620."

"1-3 WEEKS VIEW: Last Monday (07 Sep, spot at 1.1625), we highlighted that “the upside bias remains intact, but EUR should stay within a narrower range of 1.1585/1.1670.” After EUR dropped to a low of 1.1591, we highlighted the following on Friday (11 Sep, spot at 1.1610): “Downward momentum is starting to build, but it is insufficient to indicate a sustained decline. However, if EUR were to close below 1.1585, it would increase the odds of a break below the next major support at 1.1565. On the upside, a breach of 1.1645 (‘strong resistance’ level) would indicate that EUR is likely to continue to trade in a range.” EUR subsequently fell briefly to 1.1568 before rebounding to close at 1.1598 (-0.10%). We continue to hold the same view as last Friday, but we are revising the ‘strong resistance’ level to 1.1635. Looking ahead, the next level to watch below 1.1565 is 1.1535."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

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FXStreet Insights Team

FXStreet

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