A higher rise could motivate the USD/JPY to break above the 137.85 level in the short term, FX strategists at UOB Group, Quek Ser Leang, and Peter Chia.
24 hour outlook: “Yesterday, we held the view that the USD’s overbought advance had momentum to extend further, but the major resistance at 137.85 was probably out of reach. Our view was not wrong as the USD rallied to a high of 137.64. Despite the advance, the bullish momentum has not improved much. For today, we expect the USD to consolidate and trade within a range of 136.80/137.85“.
Next 1-3 weeks: “Yesterday (Aug 22, pair at 137.10) we highlighted that the USD was likely to advance, but had to break 137.85 before further dollar strength was likely. The pair subsequently rose to 137.64 before closing on a lower note firm at 137.47 (+0.39%).Although price action suggests the USD could break 137.85, the upside momentum hasn’t improved much.To look at it another way, it may be a while before the dollar can advance to the next resistance at 138.30. Overall, only a break of 136.40 (‘strong support’ level was 135.90 yesterday) would indicate that the cross is unlikely to go further.”
Source: Fx Street
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