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EUR/USD: The pair is likely to continue declining below 1.0630 – UOB

EUR/USD risks further losses below 1.0630, according to analysts at UOB Group, Lee Sue Ann and Quek Ser Leang.

24 hour opinion: We expected the EUR to consolidate in a range of 1.0645/1.0695 yesterday. The Euro subsequently traded in a range of 1.0653/1.0698 before closing at 1.0690 (+0.33%). The underlying tone has strengthened a bit and the Euro could rise today. However, an advance is unlikely to overcome the strong resistance at 1.0730. On the downside, if the Euro falls below 1.0655 (minor support is at 1.0675), it would indicate that the current slight bullish pressure has faded.

Next 1-3 weeks: After the Euro plummeted to a low of 1.0629, in our last article last Friday (September 15, pair at 1.0640), we highlighted that there had been a strong increase in bearish momentum. In our view, the Euro was likely to have resumed its weakness, but it remains to be seen if this time it can reach the March low, near 1.0515. Since then, the Euro has not been able to advance further downwards. Bearish momentum begins to wane. To keep the momentum going, EUR must break and hold below 1.0630, or chances of further decline will decrease rapidly. Conversely, if the Euro breaks above 1.0730 (no change to the ‘strong resistance’ at yesterday’s level), it would also mean that the Euro does not weaken further.

Source: Fx Street

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