USD/JPY: Likely to trade between 147.50 and 148.80 – UOB Group

FXStreet Insights Team FXStreet

Sharp fluctuations have resulted in a mixed outlook; US Dollar (USD) could continue to fluctuate against Japanese Yen (JPY), likely between 147.50 and 148.80. In the longer run, USD strength has paused for now; it is expected to trade in a range of 146.90/149.20, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

USD strength has paused for now

24-HOUR VIEW: "Subsequent to the sharp rally in USD on Tuesday, we indicated the following yesterday: 'Conditions are deeply overbought, and today, while there is room for USD to rise further, a sustained break above 149.30 is unlikely.' We did not expect the volatile price movements, as after rising to a high of 149.18, USD plunged to 146.90 before snapping back up to close at 147.86 (-0.67%). The sharp fluctuations have resulted in a mixed outlook. Today, USD could continue to fluctuate, likely between 147.50 and 148.80.

1-3 WEEKS VIEW: "We turned positive on USD early last week (see annotations in the chart below). After USD soared to a high of 149.01 two days ago, we pointed out yesterday (16 Jul, spot at 148.80) that 'although conditions remain overbought, strong momentum may continue to carry USD higher.' We added, 'the next level to monitor is 149.80 and to sustain the overbought momentum, USD must hold above 147.65 (‘strong resistance’ level).' We did not expect USD to plunge briefly to 146.90 and the subsequent sharp rebound. The breach of our ‘strong support’ level indicates USD strength has paused for now. From here, we expect USD to trade in a range of 146.90/149.20."

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 sticks to positive bias above 0.7100; lacks bullish conviction

AUD/USD trades with a positive bias for the second straight day, holding above 0.7100 in the Asian session on Friday as softer US bond yields keep US Dollar bulls on the back foot. Furthermore, hawkish RBA Governor Bullock's comments boost rate hike bets and support the Aussie. However, the Fed's hawkish outlook, along with geopolitical uncertainties, limits USD losses and caps the pair.

USD/JPY retreats below 157.00 as Ueda speaks on outlook

USD/JPY reverses the uptick to two-week highs near 157.30 in the European session on Friday as the Japanese Yen finds some respite from BoJ Governor Ueda's comments at the post-monetary policy meeting press conference. Earlier in the day, the central bank hiked the interest rate to 1.25%, with a surprise 7-2 vote.

Gold advances to fresh weekly top; eyes $$4,400 as softer US bond yields cap USD gains

Gold attracts some follow-through buying for the second straight day, and touches a fresh weekly high heading into the European session. US bond yields retreat further from multi-year highs as the recent pullback in crude oil prices helped alleviate immediate fears of runaway inflation. This caps gains for the US Dollar and supports the bullion.

Bitcoin extends recovery, Ethereum eyes $2,500, XRP holds $1.30

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) extend their recovery, trading above $76,700, $2,400 and $1.300, respectively, on Friday. These top three cryptocurrencies now face key technical levels that could determine whether their recoveries extend further or pull back.

Cardano extends gains on bullish derivatives

Cardano (ADA) extends its recovery, trading above $0.210 at the time of writing on Friday, after finding support around a key zone earlier this week. Improving derivatives positioning and supporting technical indicators indicate growing bullish sentiment among ADA traders. Derivatives data shows a bullish tilt among Cardano traders.

How Japan became the World's Banker and why that era may be ending

Japan's ultra-low interest rates helped finance trillions of dollars in global investments for more than a decade, making the Japanese Yen one of the world’s cheapest sources of funding. With the Bank of Japan expected to tighten policy again this week, that advantage may be entering a new phase. While most major economies raised interest rates, Japan remained the world's outlier.