Further upside momentum could lift USD/JPY back to the 136.00 region in the next weeks, note FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.
Key Quotes
24-hour view: “USD traded sideways last Friday until NY session when it rocketed to 135.49. Impulsive momentum suggests further USD strength is likely but in view of the overbought conditions, a break of 136.00 is unlikely for now (next resistance is at 136.50). Support is at 134.90 followed by 134.40.”
Next 1-3 weeks: “In our latest narrative from last Wednesday (03 Aug, spot at 133.50), we highlighted that USD is likely to trade between 131.30 and 135.60. USD soared to 135.49 on Friday before closing higher by +1.60% (NY close of 134.97), its largest 1-day gain in 7 weeks. Shorter-term upward momentum has improved and USD could advance to 136.00, with lower chance for extension to 136.50. The USD strength is intact as long as USD does not move below 134.00 (‘strong support’ level) within these few days.”
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