USD/JPY: USD has to maintain a foothold above 145.50 to grow – UOB Group
|The US Dollar (USD) could rise 145.50; a sustained advance above this major resistance level is unlikely. In the longer run, USD has to break and maintain a foothold above 145.50 before further advance is likely, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.
USD/JPY can rise towards 145.50 near term
24-HOUR VIEW: “Yesterday, when USD was at 144.60, we indicated that ‘the advance in USD has scope to extend above 145.00, but the major resistance at 145.50 is likely out of reach for now.’ We also indicated that ‘to maintain the buildup in momentum, USD must remain above 144.00 with minor support at 144.35.’ Our view was not wrong, as USD rose to 145.21, dropped to 144.10 and then closed largely unchanged at 144.80 (+0.03%). While upward momentum has not increased significantly, today, USD could rise above the major resistance at 145.50. A sustained advance above this level seems unlikely. The next resistance at 146.10 is also unlikely to come into view. Support levels are at 144.65 and 144.25.”
1-3 WEEKS VIEW: “In our most recent narrative from Monday (23 Sep, spot at 144.20), we highlighted that ‘the strong advance in USD last week reinforces our view that USD could recover further to 145.50.’ Yesterday, USD rose and reached a high of 145.21. We continue to expect USD to rise to 145.50, but it has to break and maintain a foothold above this level before a further advance is likely. Given that momentum has not increased much, the chance of it reaching the next major resistance at 147.00 is not high for now (there is another resistance at 146.10). Overall, we will remain positive USD as long as 143.40 (‘strong support’ level previously at 142.30) is not breached.”
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