EUR/USD risks a potential drop to the 0.9500 area – UOB

According to FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang, there is still room for EUR/USD to slip back to the 0.9500 region in the next few weeks.

Key Quotes

24-hour view: “EUR traded between 0.9567 and 0.9670 yesterday, narrower than our expected consolidation range of 0.9560/0.9700. Downward momentum is building again and the risk for today is on the downside. That said, EUR is unlikely to break clearly below 0.9530. On the upside, a breach of 0.9660 (minor resistance is at 0.9630) would indicate that EUR is unlikely to weaken to 0.9530.”

Next 1-3 weeks: “Our latest narrative from Monday (26 Sep, spot at 0.9630) still stands. As highlighted, the impulsive and outsized drop from last Friday suggests EUR could continue to weaken, possibly to 0.9500. Overall, the weakness in EUR from 2 weeks ago is intact as long as EUR does not breach 0.9750 (‘strong resistance’ level was at 0.9770 yesterday).”