EUR/USD: Next major support at 1.1490 is likely out of reach for now – UOB Group

Strong momentum suggests Euro (EUR) could break below 1.1540; the next major support at 1.1490 is likely out of reach for now. In the longer run, price action indicates that EUR is likely to break below 1.1540, the next level to watch is at 1.1490, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Price action indicates that EUR is likely to break below 1.1540

24-HOUR VIEW: "Two days ago, EUR dropped sharply to a low of 1.1577. Yesterday, when it was at 1.1605, we pointed out that 'the sharp drop appears to be overdone, and instead of continuing to weaken, EUR is more likely to trade in a range today, expected to be between 1.1575 and 1.1635.' Our assessments were incorrect, as after testing the top of our expected range at 1.1635 (high of 1.1637), EUR plummeted to a low of 1.1546. Strong downward momentum suggests EUR could break below the major support at 1.1540 today. However, oversold conditions suggest the next major support at 1.1490 is likely out of reach for now. Resistance levels are at 1.1590 and 1.1605."

1-3 WEEKS VIEW: "We highlighted yesterday (30 Oct, spot at 1.1605) that EUR 'is under mild downward pressure, and it may edge lower.' We pointed out that 'given the mild momentum, EUR is unlikely to threaten the support at 1.1540.' We did not expect EUR to drop sharply to a low of 1.1546. The price action indicates that EUR is likely to break below 1.1540. The next level to watch is at 1.1490. Overall, only a breach of 1.1635 (‘strong resistance’ level was at 1.1660 yesterday) would invalidate our current view."