In opinion of FX Strategists at UOB Group, EUR/USD could accelerate losses on a breach of the 1.0950 level in the near term.
24-hour view: “We highlighted last Friday that EUR ‘could edge higher but any advance is expected to face solid resistance at 1.1045’. EUR subsequently rose to 1.1037 before dropping to 1.0977. Downward momentum has improved and a break of 1.0950 would not be surprising. That said, it is left to be seen if EUR can maintain a foothold below this major support level (next support is at 1.0925). Resistance is at 1.1000 followed by 1.1010.”
Next 1-3 weeks: “We have expected EUR to consolidate since early last week. After trading sideways for a few days, shorter-term downward momentum is beginning to build. While downside risk has increased, EUR has to close below 1.0950 before a sustained decline is likely. On the upside, a break of 1.1130 (‘strong resistance’ level) would indicate that the build-up in downward momentum has fizzled out. Looking ahead, the next support below 1.0950 is at 1.0900.”
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