Bank of America Global Research discusses EUR.USD technical outlook and maintains a bearish bias but highlights the risk of excessive oversold condition.
"The relative strength index (RSI), a measure of trend strength and momentum, is trading at about 24. This is one of the strongest downtrends in the euro's history, besides 2015 and 1985 when the RSI was even lower. While momentum is strongly in favor of the downtrend, it is very stretched,"BofA notes.
"Finding a bottom pattern, channel breakout or systematic signals in the daily / weekly charts could trigger a long-term momentum snapback. The euro tends to bottom when momentum diverges from price, but we still do not have that," BofA adds.