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FX Strategists at UOB Group noted EUR/USD could still drop to the mid-1.2000s in the next weeks.

Key Quotes

24-hour view: “EUR traded between 1.2099 and 1.2148 yesterday, slightly wider than our expected range of 1.2100/1.2145 before closing little changed at 1.2124 (+0.05%). Momentum indicators are still mostly neutral and EUR could continue to trade sideways. Expected range for today, 1.2095/1.2150.”

Next 1-3 weeks: “Two days ago (14 Jun, spot at 1.2110), we highlighted that improvement in downward momentum could lead to EUR to ‘trade with a downward bias towards 1.2050’. Since then, EUR has been unable to make any headway on the downside as it traded in a quiet manner the past couple of days. While momentum is beginning to wane, there is still chance for EUR to decline to 1.2050. Only a break of 1.2180 (no change in ‘strong resistance’ level) would indicate that the downside risk has dissipated.”