EUR/USD risks a probable drop below 1.1000 – UOB

FX Strategists at UOB Group noted EUR/USD could breach the 1.1000 yardstick in the next weeks.

Key Quotes

24-hour view: “EUR closed at 1.1064 in NY (-0.51%) but dropped sharply during early Asian hours. Rapidly improving downward momentum suggests EUR could break the major support at 1.1000. The next support below this level is at 1.0965. Resistance is at 1.1045 followed by 1.1075.”

Next 1-3 weeks: “We have held a negative view in EUR about 3 weeks now. In our latest narrative from yesterday (03 Mar, spot at 1.1120), we highlighted that EUR could not afford to dither at these oversold levels or the chance for a move to 1.1000 would diminish quickly. EUR closed at 1.1064 in NY but dropped sharply during early Asian hours. A break of 1.1000 appears likely. A break of this solid support could potentially lead to further sharp decline as the next support level of note is at 1.0900 (there is a minor support at 1.0965). The risk for further weakness is intact as long as EUR does not move above 1.1125 (‘strong resistance’ level was at 1.1145 yesterday.”