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In opinion of FX Strategists at UOB Group, the pair should meet decent contention in the 1.1570 zone.

Key Quotes

24-hour view: “Expectation for a higher EUR yesterday was wrong as it plunged without testing the strong 1.1760 resistance. The sharp decline from a high of 1.1743 appears to have enough momentum to extend lower to 1.1600 but last week’s low near 1.1570 is not expected to come into the picture for now. On the upside, only a move back above 1.1690 would indicate that the current weakness has stabilized (minor resistance is at 1.1670)”.

Next 1-3 weeks: “The sharp decline of -0.74% yesterday (largest 1-day drop in a month) was not expected. Our previous expectation for EUR to trade at a higher 1.1640/1.1850 consolidation range is not valid anymore. While downward pressure has increased, it is too early to expect the start of a bearish phase. That said, we expect EUR to stay under pressure even though any weakness is expected to encounter solid support at 1.1570 (last week’s low). Looking further ahead, a break of 1.1570 would open up the way for a retest of the year-to-date low near 1.1505. At this stage, we apportion low odds for a clear break below 1.1505. On the upside, resistance is at 1.1690 followed by 1.1720. Only a break of 1.1720 would indicate that the current mild downward pressure has eased”.