US Dollar (USD) is likely to trade in a range of 152.40/153.40. In the longer run, further USD strength is likely; the level to watch is 153.80, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Further USD strength is likely
24-HOUR VIEW: “USD rose to a high of 152.99 two days ago and then pulled back. Yesterday, when USD was at 152.50, we were of the view that ‘there is a chance for USD to test 153.00 again before a more sustained and sizeable pullback can be expected.’ The subsequent price movements did not turn out as expected, as USD fluctuated between 152.21 and 153.23 before closing at 153.06, up by 0.25%. Today, we expect USD to range-trade, but the firm underlying tone suggests it is likely to trade in a higher range of 152.40/153.40.”
1-3 WEEKS VIEW: “We turned positive on USD at the start of the week. On Wednesday (07 Oct, spot at 150.35), we highlighted that “further USD strength is likely, and the level to watch is 153.80.” There is no change in our view. Overall, only a breach of 151.40 (‘strong support’ level previously at 150.90) would indicate that USD is not strengthening further.”