USD/JPY: 158.90 is likely out of reach today – UOB Group

FXStreet Insights Team FXStreet

Strong momentum indicates further US Dollar (USD) strength; deeply overbought conditions suggest that 158.90 is likely out of reach today. In the longer run, USD is likely to continue to rise; the level to watch is 158.90, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

USD/JPY is likely to continue to rise

24-HOUR VIEW: "When USD was at 156.85 in the early Asian trade yesterday, we noted 'a tentative increase in upward momentum'. We expected USD to 'drift higher” but we pointed out that “any advance is likely part of a higher range of 156.55/157.20'. The subsequent price movements did not turn out as expected. USD lifted off, broke above 157.20 and surged to a high of 158.18. Strong momentum indicates further USD strength, but deeply overbought conditions suggest that 158.90 is likely out of reach today. Any pullback today is likely to remain above 157.40, with minor support at 157.75."

1-3 WEEKS VIEW: "In our most recent narrative from last Wednesday (06 Jan, spot at 156.70), we highlighted that USD 'is likely to trade in a range for now between 155.60 and 157.50'. Last Friday, in a sudden move, not only did USD break above 157.50, but it also soared to a high of 158.18. With rapidly increasing upward momentum, USD is likely to continue to rise. The level to watch is last year’s high, near 158.90. We will remain positive on USD as long as it holds above the ‘strong support’ level, currently at 157.00."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD stays defensive below 0.7150 after Chinese data

AUD/USD remains on the back foot below 0.7150 in the Asian session on Tuesday, close to an over three-week low touched the previous day. US bond yields hold near multi-year highs ahead of the FOMC meeting and oil-driven inflation risks, supporting the US Dollar and weighing on the currency pair. Mixed Chinese activity data for August also fail to inspire the Aussie.

USD/JPY extends gains toward 155.00 amid USD resurgence

USD/JPY keeps pushing higher toward 155.00 early Tuesday, looking for more upside, as traders await the FOMC and BoJ meetings this week. Meanwhile, Fed rate-hike bets and oil-driven inflation risks keep US bond yields near multi-year highs, supporting the US Dollar and the pair. That said, a more hawkish repricing of the BoJ normalization path might continue to underpin the Japanese Yen and could limit USD/JPY's upside. .

Gold at the mercy of bears; focus is on $4,250

Gold adds to Monday’s pessimism, struggling to extend the daily move above the $4,300 region per troy ounce and trading with modest losses on Tuesday. The precious metal’s extra weakness follows another positive day in the US Dollar, mixed US Treasury yields and steady pre-Fed caution.

Ripple, Cardano, Hyperliquid – Easing bullish momentum sparks downside risks

Top altcoins, including Ripple (XRP), Cardano (ADA), and Hyperliquid (HYPE), are trading in the red on Tuesday, with roughly 2% losses so far. The altcoins are facing downside pressure ahead of the CLARITY Act cloture vote scheduled for Tuesday.

Markets slide as FOMC approaches

The US Dollar remains strong as markets turn increasingly cautious ahead of the FOMC. Stocks are tumbling, while Gold and Silver are moving lower under pressure from the stronger Dollar. The Japanese Yen is weaker again, while Crypto is correcting. BTC is approaching a key technical test and could fall below its 50-week moving average, while ETH remains above $2,405.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.