USD/JPY: Mixed, can trade in range – UOB Group
|Outlook for US Dollar (USD) is mixed; it could trade in a range, probably staying within yesterday’s range of 151.00/152.79. In the longer run, tentative buildup in momentum suggests USD could grind higher towards 153.30, UOB Group’s FX analyst Quek Ser Leang and Lee Sue Ann note.
USD can grind higher towards 153.30
24-HOUR VIEW: “Two days ago, USD soared to 152.17. Yesterday, we stated that ‘while the rapid rise appears to be excessive, there is scope for USD to test 152.45 before the risk of a pullback increases.’ The ensuing price movements did not develop as we expected as USD swung between 151.00 and 152.79, closing at 152.45 (+0.33%). The choppy price action has resulted in a mixed outlook. Today, USD could trade in range, probably staying within yesterday’s range of 151.00/152.79.”
1-3 WEEKS VIEW: “We indicated yesterday (11 Dec, spot at 151.80) that USD ‘must break and hold above 152.45 before further advances can be expected.’ USD then rose to a high of 152.79, pulling back to close at 152.45. While we would prefer a stronger daily close, the price action suggests that USD could grind higher towards 153.30. On the downside, if USD breaks below 151.75 (‘strong support’ level was at 151.45 yesterday), it would indicate that the current tentative buildup in upward momentum has faded.”
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