EUR/USD: near-term prospects
EUR/USD declined to $1.3750 descending from Friday’s high around $1.3830.
SEB Bank points out that euro may dip a bit more, to $1.3730 (the middle of the candle formed last Tuesday). The pair didn’t manage to settle above $1.3800 and the buyers have run out of steam.
Commerzbank notes that there’s support at $1.3695 and $1.3646. Below the latter the pair will be vulnerable for a decline to $1.3472 (Oct. 16 low) and $1.3405 (base of the 3-month upward channel). Above $1.3830 there will be more resistance at $1.3850. Bank of America adds that while a EUR/USD pullback should be seen as temporary, the downside could extend to $1.3711/3646 before renewed basing.
OCBC Bank says that the pair will be more range bound ahead of the FOMC announcement on Wednesday and as the market suspects that the ECB may be uncomfortable with the current EUR/USD level.
Chart. Daily EUR/USD