EUR/USD risks extra decline near term – UOB

FX Strategists at UOB Group believe EUR/USD could be headed towards the 1.1500 area in the near term.

Key Quotes

24-hour view: “Our expectations for EUR to ‘drop to 1.1520 first before a more sustained rebound can be expected’ did not materialize as it traded in a quiet manner between 1.1546 and 1.1571 before closing largely unchanged at 1.1550 (-0.05%). Not surprisingly, momentum indicators are neutral and EUR is likely to trade sideways for today, expected to be within a 1.1540/1.1585 range.”

Next 1-3 weeks: “There is no change in our view from yesterday (07 Oct, spot at 1.1555). As highlighted, while EUR breached the major support at 1.1530 earlier this week (low of 1.1527), downward momentum has not improved by much. That said, further EUR weakness towards 1.1500 is likely. The weak phase in EUR that started earlier last week is deemed intact as long as it does not move above 1.1605 (no change in ‘strong resistance’ level from yesterday).”