EUR/USD: Downside bias hinges on 1.1665 break – UOB

UOB analysts Quek Ser Leang and Lee Sue Ann highlight that EUR/USD has rebounded within a tight range after earlier weakness, with recent price action seen as part of a short-term consolidation. Over the 1–3 week horizon, they still see scope for further downside, but stress that a sustained move toward 1.1625 requires a clear break and hold below 1.1665 while 1.1750 caps the topside.

Short-term range with bearish risk

"24-HOUR VIEW: We expected EUR to decline last Thursday, but we highlighted that “the increase in momentum is not enough to indicate a move to 1.1665.” After EUR subsequently dropped to a low of 1.1668, we highlighted on Friday that “while there is no sign of a recovery yet, downward momentum is starting to slow, and instead of continuing to decline today, EUR is more likely to trade in a range between 1.1665 and 1.1715.” EUR then dipped to 1.1671, rose to 1.1723 before settling at 1.1720 (+0.32%). The current price movements in EUR are likely part of a range-trading phase, probably between 1.1685 and 1.1730."

"1-3 WEEKS VIEW: Last Friday (24 Apr, spot at 1.1685), we noted that “downward momentum has increased further, but EUR must break and hold below 1.1665 before a move to 1.1625 can be expected.” We added, “the likelihood of EUR breaking clearly below 1.1665 will remain in place as long as the ‘strong resistance’ level, now at 1.1750, is not breached.” We continue to hold the same view."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)