EUR/USD could slip back to 1.1820 – UOB

In view of FX Strategists at UOB Group, the pair’s stance has shifted to neutral from bullish, allowing at the same time a probable test of the 1.1820 area in the near term.

Key Quotes

“We highlighted yesterday (13 Sep) that “EUR has to move above 1.2000 by end of today or the expected loss of momentum would be enough to indicate that the current bullish outlook has shifted to neutral”. The attempt to move above 1.2000 failed as EUR dropped sharply from a high of 1.1994”.

“The rapid decline is accompanied by rather strong downward momentum and the risk is clearly tilted to the downside. As long as 1.1995 remains intact in the coming days (1.1950 is already a strong level), the immediate pressure is on the downside towards 1.1820”.

“Depending on the pace of decline, extension to 1.1770 would not be surprising. At this stage, a sustained move below 1.1770 seems unlikely. Positioning wise, those who bought at 1.1970 would have taken a loss of 50 pips (-0.42%)”.