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EUR/USD: Door open to a probable drop to 0.9500 – UOB

EUR/USD: Door open to a probable drop to 0.9500 – UOB

A continuation of the downtrend could drag EUR/USD to the 0.9500 region in the coming weeks, according to UOB Group currency strategists Lee Sue Ann and Quek Ser Leang.

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24 hour view: “We weren’t expecting EUR/USD’s outsized 1.48% drop (NY close 0.9690) last Friday (expected range trading). EUR/USD briefly dipped below 0.9600 during Asian hours before returning to rise. Despite the bounce, EUR/USD weakness has not stabilized. In other words, EUR/USD could continue to weaken, although 0.9500 is unlikely to be threatened for now. Resistance is at 0.9700 and 0.9740″ .

Next 1-3 weeks:​“We have held a negative view on the EUR/USD for over a week. In our latest narrative last Thursday (Sep 22, EUR/USD at 0.9830), we indicated that the EUR/ USD keep falling in the coming days We state that “levels to watch are at 0.9770 and 0.9720” On Friday (Sep 23) EUR/USD broke through both 0.9770 and 0.9720 Today EUR/USD has widened its decline during Asian time The impulsive and exaggerated decline suggests that EUR/USD could weaken further, possibly to 0.9500 To the upside, a break of 0.9810 (“strong resistance” level was at 0.9940 last Friday) would indicate that the current EUR/USD weakness has stabilized.”

Source: Fx Street