USD/JPY UPSIDE PRESSURE MITIGATED BELOW 144.00 – UOB
A break below the 144.00 level should alleviate the upside pressure in USD/JPY in the short-term horizon, comment UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.
Key Quotes
24-hour view: Last Friday, USD fell to a low of 144.92 before closing at 145.37 (-0.32%). There is a slight increase in downward momentum, and USD is likely to trade with a downward bias today. However, any decline is unlikely to threaten the strong support at 144.00 (there is another support at 144.60). Resistance is at 145.60, followed by 146.00.
Next 1-3 weeks: In our most recent update from 11 Aug (spot at 144.80), we held the view that USD “could continue to advance, albeit likely at a slower pace.” We indicated that “the next level to watch above 145.05 is at 146.00.”. Last week, USD broke above 146.00 and rose to a high of 146.56, then pulled back. The pullback in overbought conditions and waning momentum suggest the odds for further sustained advance in USD are not high. However, only a breach of 144.00 (‘strong support’ level) would indicate that USD is not advancing further. Looking ahead, if USD were to break clearly above 146.56, any further advance is likely to face considerable resistance near 147.50
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