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EUR/USD has strong support at 1.1010 – UOB, but analysts expect a record-breaking drop below this level that could lead to a global currency crisis.

According to Economist Lee Sue Ann and Markets Strategist Quek Ser Leang of UOB Group, further declines in the EUR/USD are anticipated to run into difficult resistance around 1.1010.

View for the next 24 hours: Yesterday, after EUR dropped to 1.1173 and then rose, we noted that “the underlying tone still appears to be soft” and retained the opinion that “there is a chance for EUR to retest the 1.1175 level before the risk of a more sustained rebound increases.” Instead of attempting to challenge 1.1175, the EUR fell to a low of 1.1117. There seems to be room for the strong selloff to continue. Oversold conditions, however, indicate that a prolonged slide below 1.1090 is unlikely. A threat to the main support at 1.1010 is likewise doubtful. Resistance is found at 1.1170, then 1.1200.

 

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