The currency strategists of the UOB Group noted that EUR / USD is at risk of a deeper pullback towards the 1.1800 zone in the near term.
24 hour perspective: “While we expected the EUR to weaken last Friday, we were of the opinion that any weakness was unlikely to threaten the main support at 1.1910. However, the euro fell more than expected as it broke 1.1910 and fell to 1.1892. The rapid and steep decline appears to be ahead of itself, but the current weakness still shows no signs of stabilizing. There is room for the euro to retest the 1.1890 level before a more sustained recovery can be expected.. For today, the next support at 1.1850 is unlikely to enter the picture. On the upside, a breakout of 1.1975 would indicate that current weakness has stabilized (minor resistance is at 1.1945) ”.
Next 1-3 weeks: “We have had a negative view on EUR since the beginning of the month. As the euro fell as expected, in our latest narrative last Friday (Mar 5, pair at 1.1965), we highlighted that the focus had shifted to the main support at 1.1910. Our view was correct as the EUR broke through 1.1910 and fell to 1.1892 during New York hours on Friday. The outlook for the euro remains negative and it would not surprise further losses to 1, .800. Only a break of 1.2020 (the ‘strong resistance’ level was at 1.2055 last Friday) would indicate that the current negative phase in the EUR is over. “
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