USD/JPY: Further USD strength is likely – UOB Group

FXStreet Insights Team FXStreet

Impulsive momentum is likely to outweigh overbought conditions, but it remains to be seen if US Dollar (USD) can break above 153.00. In the longer run, further USD strength is likely; the level to watch is 153.80, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

USD/JPY may might above 153.00

24-HOUR VIEW: "USD surged on Monday. Yesterday, Tuesday, we indicated that USD 'could continue to rise, but any advance is likely part of a higher range of 149.70/150.70.' We added, 'a sustained rise above 150.70 is unlikely.' We were correct on the first count, but not the second, as USD surged and reached a high of 152.04. It continues to rise in early Asian trade today. While impulsive momentum is likely to outweigh the deeply overbought conditions, it remains to be seen if USD can break above 153.00 today. On the downside, support levels are at 151.80 and 151.30."

1-3 WEEKS VIEW: "Yesterday (07 Oct, spot at 150.35), we highlighted that 'the price action suggests USD could continue to rise and test the significant resistance zone of 150.90/151.20.' We did not expect the subsequent rally that easily broke above the resistance zone. Further USD strength is likely, and the level to watch is 153.80. We will maintain our positive USD view as long as the ‘strong support’ at 150.50 (level was at 148.50 yesterday) holds."

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