Euro May Advance to Six-Week High, UBS Says: Technical Analysis
The euro may strengthen against its U.S. counterpart to the highest level in six weeks if it breaks key levels of resistance, according to UBS AG, citing technical indicators.
If the shared currency advances past resistance at $1.3012 and $1.3042, it could appreciate to its Sept. 17 monthly high of $1.3172, Richard Adcock, head of fixed-income technical strategy at UBS in London, wrote today in a note to clients. Last week’s low of $1.2883 is a near-term support level for the euro, he said.
“As long as support at this month’s $1.2802 low holds, the risk is for resumption of strength,” Adcock wrote in the report. He didn’t immediately respond to a message requesting comment.
The euro increased 0.2 percent to $1.2984 at 10:38 a.m. New York time after earlier gaining 0.5 percent to $1.3021, its highest level since Oct. 25. The 17-nation currency rose 0.5 percent to 103.68 yen.
The euro has strengthened 1.4 percent this month, the second-best performance after the Swiss franc among the 10 developed-nation currencies tracked by Bloomberg Correlation- Weighted Indexes. The dollar rose 0.3 percent.
In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index. Resistance refers to an area on a chart where sell orders may be clustered. Support is an area where there may be buy orders.
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