EUR/USD now looks to 1.2050 – UOB

“The swift and sharp decline in EUR to a coffee of 1.2091 last Friday came as a surprise (we were expecting EUR to trade between 1.2140 and 1.2200). The rapid drop is amid strong momentum and EUR is predicted to weaken further. That said, oversold conditions suggest that subsequent major support at 1.2050 is probably going out of reach (there is another support at 1.2075). On the upside, 1.2150 is predicted to be strong enough to cap any rebound (minor resistance is at 1.2135).”

Next 1-3 weeks: “Our latest narrative was from last Wednesday (09 Jun, spot at 1.2175) where EUR ‘could trade between 1.2125 and 1.2220 for a period of time’. We highlighted that EUR ‘has to shut below 1.2125 or above 1.2220 before a sustained directional move are often expected’. EUR plummeted to 1.2091 last Friday before closing on a weak note at 1.2106 (-0.52%). Rapid improvement in downward momentum suggests that EUR is probably going to trade with a downward bias towards 1.2050. Resistance is at 1.2150 but only an opportunity of 1.2180 (‘strong resistance’ level) would indicate that the present downward pressure in EUR has eased

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