US Dollar (USD) could continue to weaken vs Japanese Yen (JPY); oversold conditions suggest any decline is unlikely to reach 146.50 today. In the longer run, increase in momentum indicates further USD weakness; the level to watch is 146.50, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Increase in momentum indicates further USD weakness
24-HOUR VIEW: "During the late NY session, USD soared to 150.48 before dropping sharply to close at 149.24 (-0.25%). It continues to drop sharply today. Although the outsized decline has resulted in a sharp and swift rise in downward momentum, conditions are deeply oversold. However, as long as USD remains below 149.40, it could continue to weaken. Given the oversold conditions, any decline is unlikely to reach the major support at 146.50 today. There is another support level at 147.30."
1-3 WEEKS VIEW: "In our update from two days ago (01 Apr, spot at 149.80), we highlighted that USD 'appears to have moved into a consolidation phase and it is expected to trade in a 148.40/151.00 range for now.' Today, USD fell clearly below 148.40. The increase in momentum indicates further USD weakness. The level to watch is 146.50. To keep the momentum going, USD must remain below 150.10."
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