EUR/USD can continue to decline – UOB Group

Euro (EUR) is likely to trade in a range between 1.0375 and 1.0435 vs US Dollar (USD). In the longer run, EUR could continue to decline; it is currently unclear whether the significant support at 1.0330 is within reach, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Unclear whether the significant support at 1.0330 is within reach

24-HOUR VIEW: "EUR plunged and closed sharply lower by 0.82% last Thursday. On Friday, we indicated that 'the steep decline appears to be excessive, but with no signs of stabilisation just yet, EUR could test the 1.0375 level.' However, we pointed out that 'the significant support at 1.0330 is unlikely to come into view.' EUR subsequently dropped to 1.0359, closing at 1.0375, lower by 0.21%. It traded on a firm note after opening today. Given the deeply oversold conditions, we do not expect EUR to weaken further. Today, it is more likely to trade in a range between 1.0375 and 1.0435."

1-3 WEEKS VIEW: "Last Friday (28 Feb, spot at 1.0395), we revised our view for EUR from positive to negative. We indicated that EUR 'could continue to decline.' We added, 'it is currently unclear whether the major support at 1.0330 is within reach,' and 'to keep the momentum going, EUR must remain below 1.0470 (‘strong resistance’ level).' Our view remains unchanged, but the ‘strong resistance’ level has moved lower to 1.0455 from 1.0470."