Japanese Yen: Bullish but momentum slowing against US Dollar – UOB

UOB strategist Quek Ser Leang reports USD/JPY dropped to 153.23 and closed at 153.54, with intraday bias tilted lower but expected to stay within 153.05–154.30. On a 1–3 week horizon, he has held a negative Dollar stance, yet notes downward momentum is slowing and the odds of revisiting the 152.08 low are diminishing. A break above 154.90 would signal stabilisation.

Downside bias within defined range

"24-HOUR VIEW: Last Friday, we highlighted that USD “could rise toward 154.90.” We also highlighted that “a break above this level is not ruled out, but the strong resistance at 155.20 is unlikely to come under threat.” We were incorrect, as USD fell to 153.23 before settling 0.57% lower at 153.54. Despite the relatively sharp drop, downward momentum has not increased by much. The bias for USD today is on the downside, but any decline should stay within a 153.05/154.30 range."

"1-3 WEEKS VIEW: We have been holding a negative USD stance since early this month. Last Tuesday (08 Sep, spot at 153.95), we indicated that “the price action suggests USD is likely to continue to weaken, and the next support level to watch is the year-to-date low of 152.08.” After USD rebounded, we indicated on Friday (11 Sep, spot at 154.50) that “downward momentum is slowing, and the odds of 152.08 coming into view are diminishing.” Our view remains unchanged. On the upside, a breach of 154.90 (‘strong resistance’ previously at 155.20) would mean that the weakness in USD has stabilised."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)