FX Strategists at UOB Group noted EUR/USD remains focused on a potential test of the 1.0805 level in the next weeks.

Key Quotes

24-hour view: “We expected EUR to weaken yesterday but we noted that ‘the next support is a major level at 1.0805’. EUR weakened as expected, but it rebounded strongly from 1.0804. Deeply oversold conditions suggest EUR is unlikely to weaken further. For today, EUR is more likely to consolidate and trade between 1.0805 and 1.0925.”

Next 1-3 weeks: “Our update from yesterday (07 Mar, spot at 1.0875) still stands. As highlighted, EUR is still clearly weak and the next level to focus on is a major long-term support at 1.0805. Note that EUR subsequently dropped to 1.0804 before rebounding. Looking ahead, a clear break of 1.0805 could lead to rapid decline to 1.0740. The risk for further weakness is intact as long as EUR does not move above 1.1000 (no change in ‘strong resistance’ level from yesterday).”