United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note EUR/USD’s slide extended to 1.1324 before a rebound, with the pair now seen consolidating between 1.1330 and 1.1385 in the very near term. Over 1–3 weeks, they still see scope for further Euro weakness, but stresses that a daily close below 1.1325 is needed to open the way toward 1.1280.

Further downside needs daily confirmation

"24-HOUR VIEW: Following the decline in EUR two days ago, we highlighted yesterday that “despite the oversold conditions, there is a chance for EUR to test 1.1360.” We also highlighted that “based on the prevailing momentum, 1.1325 is likely out of reach.” However, EUR fell more than expected to 1.1324 before rebounding. The rebound from deeply oversold conditions suggests that instead of continuing to decline, EUR is more likely to consolidate today, probably between 1.1330 and 1.1385."

"1-3 WEEKS VIEW: After EUR fell below our previous technical target at 1.1410 two days ago, we indicated yesterday (24 Jun, spot at 1.1380) that “the price action continues to suggest a lower EUR, and the next level to watch is 1.1325.” We did not expect EUR to reach 1.1325 so quickly as it fell to a low of 1.1324. While EUR could continue to weaken, the steep decline from last week appears overstretched. Note that EUR has posted six consecutive lower highs as of yesterday. From here, EUR must close below 1.1325 before a move to 1.1280 can be expected. The likelihood of EUR closing below 1.1325 will remain intact as long as 1.1420 (‘strong resistance’ level was at 1.1455 yesterday) is not breached."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)