EUR is expected to decline gradually, potentially reaching 1.0825. In the longer run, to reach the significant support at 1.0770, EUR must keep moving lower, or the likelihood of it reaching this level will diminish quickly, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Downward momentum can be short-lived

24-HOUR VIEW: “We expected EUR to edge lower yesterday, but we indicated that ‘due to mild momentum, any decline is unlikely to break clearly below 1.0860.’ Our anticipation for EUR to weaken was correct, but we underestimated the decline as it dropped to a low of 1.0853. Downward momentum has increased, albeit not much. Today, we continue to expect EUR to decline gradually, potentially to 1.0825. We do not expect the major support at 1.0770 to come into view. On the upside, resistance levels are at 1.0880 and 1.0900.”