USD/JPY: Likely to trade in a 146.50/148.60 range – UOB Group
US Dollar (USD) is likely to trade in a 146.50/148.60 range vs Japanese Yen (JPY). In the longer run, further USD strength is likely, but it could first trade in a range for a few days; the level to monitor is 149.30, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Further USD strength is likely
24-HOUR VIEW: "USD surged yesterday, closing at 148.45, up by 2.14%, its largest one-day gain since March 2020. The outsized rise appears excessive. This, combined with deeply overbought conditions, suggests that instead of continuing to rise, USD is more likely to trade in a 146.50/148.60 range."
1-3 WEEKS VIEW: "We highlighted the following last Friday, 09 May, when USD was at 145.70: 'The sharp rally has gained momentum, but USD must break and hold above 146.55 before a further sustained rise is likely. Looking ahead, above 146.55, there is another strong resistance at 147.10. On the downside, any pullback is likely to hold above the ‘strong support’ level, currently at 143.90.' Yesterday, USD lifted off and skyrocketed, reaching a high of 148.64. While the sharp and rapid increase in momentum suggests further USD strength, deeply overbought conditions could lead to a few days of range trading first. The level to monitor on the upside is 149.30, while on the downside, the ‘strong support’ level has moved higher to 146.00 from 143.90."
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.
