EUR/USD is expected to meet support around 1.1010 – UOB

Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group expect EUR/USD to meet solid contention around 1.1010.

Key Quotes

24-hour view: We highlighted last Friday that “the sharp selloff in EUR has room to extend.” We added, “oversold conditions suggest a sustained decline below 1.1090 is unlikely.” However, EUR did not threaten 1.1090 as it dipped to 1.1106 before closing largely unchanged at 1.1123 (0.04%). Downward momentum has waned, and EUR is unlikely to weaken further. Today, EUR is more likely to trade sideways in a range of 1.1105/1.1155. 

Next 1-3 weeks: Our update from last Friday (21 Jul, spot at 1.1135) still stands. As highlighted, the recent EUR strength has ended. The current price movements are likely part of a corrective pullback, but any decline is likely to face solid support at 1.1010. The downward pressure will remain intact unless EUR breaks above the ‘strong resistance’ at 1.1200 (level was at 1.1235 last Friday).