Expected to edge lower – UOB Group

The Euro (EUR) is expected to edge lower; it remains to be seen if it can break the major support at 1.0900. In the longer run, outlook for EUR remains negative; the next level to watch is 1.0900, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

Next level to watch is 1.0900

24-HOUR VIEW: “We expected EUR to trade in a sideways range of 1.0950/1.1000 yesterday. However, it edged lower to 1.0936, closing at 1.0939 (- 0.37%). There has been a slight increase in momentum, and EUR is likely to continue to edge lower today. That said, it remains to be seen if it has enough momentum to break the major support at 1.0900. Resistance is at 1.0960; a breach of 1.0980 would mean that the current mild downward pressure has faded.”

1-3 WEEKS VIEW: “Our latest narrative was from Monday (07 Oct, spot at 1.0970), wherein ‘further EUR weakness appears likely.’ We pointed out ‘the next two support levels to monitor are 1.0935 and 1.0900.’ Yesterday (Wednesday), EUR dropped to a low of 1.0936. While there has been no significant increase in momentum, the outlook for EUR remains negative. The next level to watch is at 1.0900. Note that below this level lies a significant support zone between 1.0860 and 1.0885. On the upside, a breach of 1.1010 (‘strong resistance’ level previously at 1.1045) would mean that the EUR weakness from the middle of last week (see annotations in the chart below) has come to an end.”