UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang advised there may be nonetheless scope for EUR/USD to drop to the 1.0630 area within the close to time period.
Key Quotes
24-hour view: We anticipated EUR to commerce in a variety between 1.0700 and 1.0750 yesterday. Nevertheless, it dropped to a low of 1.0685 earlier than ending the day at 1.0699 (-0.26%). Whereas the decline lacks momentum, the weak point in EUR has not stabilised simply but. At this time, EUR might proceed to weaken, though the most important help at 1.0635 is extremely possible out of attain (there may be one other help at 1.0660). Resistance is at 1.0715; if EUR breaks above 1.0735, it will recommend that the weak point in EUR has stabilised.
Subsequent 1-3 weeks: Our replace from two days in the past (06 Sep, spot at 1.0725) nonetheless stands. As highlighted, EUR is more likely to proceed to weaken, and the following degree to observe is Could’s low of 1.0635. Nevertheless, if EUR breaks above the ‘robust resistance’ at 1.0765 (degree was at 1.0785 yesterday), it will imply that the EUR weak point that began early this week has stabilised. Trying forward, if EUR breaks beneath 1.0635, the main target will shift to the yr’s low close to 1.0515.