The analysis team at UOB suggest that the EUR is not showing any signs of stabilizing and could extend its decline to 1.1300 level.
Key Quotes
“24 Hour View: Expectation for EUR to trade sideways last Friday was wrong as it slumped to a low of 1.1324. While the rapid drop appears to be running ahead of itself, there is no sign of stabilization just yet and EUR could extend its decline to 1.1300. The next support at 1.1280 is unlikely to come into the picture. On the upside, only a move above 1.1375 would indicate the current downward pressure has eased (minor resistance is at 1.1355).”
“1-3 WEEKS VIEW Neutral (since 21 Aug 18, 1.1485): EUR to trade sideways for now.
While the relatively large decline of -0.58% last Friday (NY close of 1.1340) came as a surprise, there is no change to our view and we continue to expect EUR “to trade sideways for now”. That said, downward pressure has ticked up and the immediate bias is on the downside. At this stage, we view any weakness as part of a 1.1280/1.1420 consolidation range. Looking ahead, a break of 1.1280 is not ruled out but for the next one week or so, the 1.1213 low seen two weeks ago is unlikely to come into the picture.”
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