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FX Strategists at UOB Group noted EUR/USD remains offered and could move to the 1.0775 level in the next weeks.

Key Quotes

24-hour view: “We expected EUR to weaken but were of the view the ‘1.0900 support is likely out of reach’. However, EUR plunged to an overnight 1.0800 before snapping higher. While severely oversold, the rapid decline is not showing sign of stabilization just yet. In other words, it is too early to expect a sustained rebound. EUR has to move above 1.1050 (minor resistance is at 1.1000) in order to indicate the current weakness has stabilized. Until then, EUR could revisit the 1.0800 level, possibly even testing last month’s low at 1.0775.”

Next 1-3 weeks: “We turned negative on EUR yesterday (18 Mar, spot at 1.1015) and expected it to ‘test the 1.0900 support’. EUR subsequently lurched lower and plunged to 1.0800 before snapping higher. Despite the strong bounce from the low, the overall outlook for EUR has deteriorated. From here, a break of last month’s 1.0775 low would not be surprising and breach of this level would likely open the way for further weakness to 1.0700. Overall, we would continue to hold a negative EUR view unless it can move above 1.1100 (‘strong resistance’ level was at 1.1180 yesterday).”