The Euro (EUR) could face further declines, but breaking the significant support level at 1.0640 remains uncertain. UOB Group analysts highlight that a sustained EUR decline is possible if it breaches this level.
EUR to Stabilize Above 1.0730
24-Hour View:
“Two days ago, EUR fell to 1.0689 and then rebounded. Yesterday, we noted a slight increase in momentum and suggested that EUR ‘could dip below the 1.0689 low, but the major support at 1.0670 is unlikely to come under threat.’ The anticipated decline exceeded our expectations as EUR fell to a low of 1.0664. Today, EUR could decline further, but it is not clear for now if it can break the significant support level at 1.0640. Note that 1.0665 is still a rather strong support level. Resistance is at 1.0695; a breach of 1.0710 would mean that the weakness in EUR has stabilized.”
1-3 Weeks View:
“Our latest narrative from two days ago (spot at 1.0730) indicated that EUR ‘has likely entered a consolidation phase and is likely to trade between 1.0670 and 1.0800.’ Yesterday, EUR fell to a low of 1.0664. Downward momentum is building again, but it does not appear strong enough to suggest a sustained decline. There is a significant support level at 1.0640. Provided that 1.0730 is not breached, EUR is likely to remain under pressure, but a sustained decline is probable only if it clearly breaks below 1.0640.”
This analysis underscores the critical nature of the 1.0640 support level in determining the Euro’s trajectory. While further declines are possible, a definitive break below this level is necessary for a sustained downward trend.
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