EUR/USD: A break below 1.1615 appears unlikely – UOB Group

Slight increase in downward momentum could lead to Euro (EUR) edging lower, but a break of 1.1615 appears unlikely. In the longer run, weakness in EUR from early last week has stabilized; for the time being, it is likely to consolidate between 1.1615 and 1.1730, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Weakness in EUR from early last week has stabilized

24-HOUR VIEW: "On Monday, EUR rebounded strongly to a high of 1.1698. In the early Asian session yesterday, when EUR was at 1.1665, we highlighted the following: 'The sharp rebound appears to be running ahead of itself, and EUR is unlikely to rise much. Today, EUR is more likely to trade in a range, probably between 1.1640 and 1.1700'. EUR subsequently traded sideways until the NY session, when it rose briefly to 1.1677 before dropping to a low of 1.1633. EUR closed slightly lower at 1.1641 (-0.22%). The price action has led to a slight increase in downward momentum. Today, we expect EUR to edge lower but a break of the major support at 1.1615 appears unlikely. On the upside, resistance levels are at 1.1660 and 1.1670."

1-3 WEEKS VIEW: "After holding a negative EUR stance for a week, we revised our view yesterday (13 Jan, spot at 1.1665), indicating that 'the weakness in EUR from early last week has stabilized'. We highlighted that EUR 'appears to have entered a consolidation phase, and for the time being, it is likely to trade between 1.1615 and 1.1730'. There is no change in our view. Looking ahead, if EUR breaks and holds below 1.1615, it could potentially trigger a decline toward 1.1585."