Ella 
The euro fell sharply, falling to a six-month low of 1.0629, surprising the bank (we expect the euro to remain range-bound). While the decline appears to be overdone, the euro’s weakness has not stabilized. The euro could fall further today, but a clear move below 1.0600 is unlikely. Resistance lies at 1.0665 and a move above 1.0690 would mean no further weakness in the euro.
Next 1-3 weeks: On Tuesday (September 12, when EUR/USD was at 1.0750), the bank noted that “the euro’s weakness has stabilized” and believed that the euro “is likely to trade between 1.0690 and 1.0820.” During London trading, the euro not only fell below 1.0690, but also edged below the May low of 1.0635 (as low as 1.0629). The sharp increase in downward momentum in EUR/USD suggests that the euro has returned to weakness. However, it remains to be seen whether the euro has enough momentum to break below the March low near 1.0515. To maintain the weak momentum, the euro must remain below the current “strong resistance” level of 1.0730. This strong resistance will move lower in the next few days.
