USD/JPY: Likely to consolidate in a range of 144.00/145.00 – UOB Group
US Dollar (USD) is likely to consolidate in a range of 144.00/145.00. In the longer run, increase in momentum is not sufficient to indicate a sustained advance just yet; USD must first break and hold above 145.50, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Increase in momentum is not sufficient to indicate a sustained advance
24-HOUR VIEW: "We expected USD to 'consolidate in a 144.00/145.15 range' yesterday. USD then rose to 144.94, dropped to 143.96, before rebounding to close modestly lower by 0.19% at 144.58. The price action still appears to be part of a consolidation phase. Today, we expect USD to trade in a range of 144.00/145.00."
1-3 WEEKS VIEW: "Last Wednesday (04 Jun, spot at 143.85), we stated that 'the recent price action suggests USD is still trading in a range, most likely between 142.10 and 145.50.' On Friday, USD soared to a high of 145.08. Yesterday (09 Jun, spot at 144.70), we indicated that the increase in upward momentum is not sufficient to indicate a sustained advance just yet.' However, we pointed out that 'if USD were to break and hold above 145.50, it could potentially trigger a strong recovery.' The likelihood of USD breaking clearly above 145.50 will remain intact as long as the ‘strong support’ at 143.30 (level previously at 143.00) is not breached."
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