USD/JPY: The pair can test 142.80 near term – UOB Group
|As long as the US Dollar (USD) remains above 140.90, it could test 142.80 before leveling off. In the longer run, the USD weakness seems to have stabilised; it is expected to trade in a range between 140.00 and 144.00 for now, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.
USD/JPY to trade 140.00 and 144.00 long term
24-HOUR VIEW: “On Monday, USD fell sharply to 139.56, then rebounded. Yesterday, we indicated that ‘the rebound in severely oversold conditions and slowing momentum indicates that instead of continuing to weaken, USD is more likely to trade in a sideways range of 140.10/141.40.’ However, after dipping to a low of 140.30, USD lifted off and soared to 142.47, closing on a strong note at 142.40 (+1.28%). The rapid rise appears to be running ahead of itself. That said, as long as USD remains above 140.90 (minor support is at 141.40), USD could test 142.80 before leveling off. The next resistance at 144.00 is not expected to come into view.”
1-3 WEEKS VIEW: “While USD fell and broke below the round-number support of 140.00 two days (low of 139.56), we pointed out yesterday (17 Sep, spot at 140.70) that ‘downward momentum has not increased much.’ However, we indicated that ‘the weakness has not stabilised, and USD could continue to weaken even though it remains to be seen if 139.00 is within reach this time round.’ We added, ‘a breach of 142.20 would indicate that the weakness has stabilised.’ We did not anticipate USD to rise strongly as it soared to a high of 142.47. The recent USD weakness seems to have stabilised. For the time being, we expect USD to trade in a range between 140.00 and 144.00.”
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