According to UOB analysts Quek Ser Leang and Lee Sue Ann, the EUR/USD currency pair extended its recent decline, reaching a low of 1.1358 before closing marginally lower by 0.01% at 1.1379. The analysts note that the Euro is now in deeply oversold territory, with downward momentum beginning to slow, suggesting that further significant weakness is unlikely in the near term [1].
UOB highlights strong support levels for the Euro at 1.1355 and 1.1325, indicating that these levels may limit additional downside. On the resistance side, the range between 1.1400 and 1.1430 is seen as key; a break above this range would signal that the recent Euro weakness is stabilizing [1].
The analysts also reference their previous outlook from September 23, when the Euro was at 1.1450, noting that while a test of 1.1400 was anticipated, the odds of a sustained decline below this level were considered low. However, the breach of 1.1400 led to a sharp drop to 1.1358. Despite the possibility of further weakening, UOB emphasizes that the substantial decline over the past two weeks and the oversold conditions suggest limited scope for additional downside [1].
No specific market reactions or forward-looking analyst opinions beyond the technical outlook are provided in the article.
CONCLUSION
UOB analysts believe that while the Euro could weaken further against the US Dollar, the downside is likely limited due to deeply oversold conditions and strong support levels. A move above 1.1430 would indicate stabilizing Euro weakness. Market participants may watch these technical levels closely for signs of a reversal or continued consolidation.