Usdjpy To Stay Capped Uob Group

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Usdjpy To Stay Capped Uob Group

Usd/Jpy To Stay Capped Below 158.00 - Uob Group

According to UOB Group, the US dollar can still rebound higher than its current levels. However, the USD/JPY pair is unlikely to break the 158.00 resistance, given the recent overbought conditions.

But if the USD/JPY can manage to break the 158.00 and 158.50 resistance levels, it would be a sign that the US Dollar weakness has ended and the currency has started to stabilize against the Japanese Yen.

Usd/Jpy Shows Overbought Signals

day earlier, the US Dollar rebounded, which was a surprise for even the analysts of the UOB Group. In fact, the US Dollar staged a strong rebound against the JPY and ended the day near 157.37 with a +0.77% gain.

In the short term, the nearest support for the USD/JPY is around 156.90 and then 156.30. On the way up, the first resistance is around 158.00, while the second one is near 158.50.

For the next 1 to 3 weeks, there's a high chance that the Japanese Yen will weaken against the USD and other currencies. However, it is still too early to think whether the 155.50 level will become accessible or not.

If the USD/JPY breaks below the 155.50 support, it would further intensify the US Dollar weakness. In that case, the next levels to watch will be around 154.50, 154.00, and then 153.95. All of these are important support levels and can prove to be roadblocks for any Japanese Yen appreciation.

Right now, the USD/JPY is showing overbought signals, which doesn't bode well for the USD/JPY. We all know that the Bank of Japan is really serious about keeping the exchange rate of the Japanese Yen stable in order to control inflation in the country.

With the US Dollar weakness, FX intervention fears, and overbought conditions in the USD/JPY, the path to least resistance is towards the downside. Not to mention that USA is likely to adopt a dovish stance on interest rate starting from September while the BoJ is expected to hike the interest rate.

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