According to UOB Group’s FX Strategists, further fall in the EUR/USD might see 1.17400 retested in the coming weeks.
Observation for 24 hours: “The EUR ‘may breach the primary support around 1.1800, but the next level at 1.1780 is likely out of reach for now,’ we said yesterday. Despite the fact that EUR briefly approached 1.1780 before rebounding, our prediction was correct. While the drop is oversold, additional EUR depreciation is a possibility. However, for the time being, the next significant support at 1.1740 is unlikely to enter the picture (there is another support at 1.1760). A break over 1.1840 (minor resistance around 1.1820) on the upside would signal that the recent weakness has stabilized.”
Within the next 1-3 weeks: “For the past week, we’ve had a bearish outlook on EUR. ‘Downward momentum has been reinvigorated, and a break of 1.1800 would open the road for EUR to drop to 1.1780,’ we said in yesterday’s update (07 Jul, spot at 1.1825). While our assessment was correct, we did not anticipate the EUR falling to 1.1780 in such a short period of time (low of 1.1780 during NY hours). The market action suggests that further EUR depreciation is expected, with 1.1740 as the next level to watch. Overall, the current downturn is expected to continue as long as the EUR does not rise over 1.1860 (the previous’strong resistance’ mark was at 1.1895).”/n
