USD/JPY: Strong momentum suggests further USD weakness – UOB Group
Strong momentum suggests further US Dollar (USD) weakness against Japanese Yuan (CNH), but any decline might not be able to break the major support at 145.75. In the longer run, rapid increase in momentum indicates USD could weaken to 145.75, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
USD has a chance of weakening to 145.75
24-HOUR VIEW: "We did not anticipate USD to drop sharply yesterday (we were expecting range trading). Strong downward momentum suggests further USD weakness. However, due to the oversold conditions, any decline might not be able to break the major support at 145.75. On the upside, resistance levels are at 147.00 and 147.40."
1-3 WEEKS VIEW: "In our most recent narrative from last Thursday (16 Jul, spot at 148.30), we highlighted that USD is expected to 'trade in a range of 146.90/149.20.' Yesterday, we indicated that 'there has been a slight increase in downward momentum, but not enough to indicate a continued decline for now.' We did not expect USD to drop sharply for the second straight day. The rapid increase in momentum indicates USD could weaken to 145.75. If it breaks clearly below this level, the next level to watch is 144.95. To keep the momentum going, USD must hold below 148.00."
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FXStreet Insights Team
FXStreet
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