The US Dollar (USD) is expected to test the 7.2550 level before stabilizing, with the subsequent support at 7.2400 unlikely to be threatened, according to UOB Group FX analysts Quek Ser Leang and Peter Chia.
USD Trends Lower Toward 7.2400
24-Hour View: “We did not anticipate the sharp decline of the USD yesterday, which saw a 0.34% drop, closing at 7.2673. Although this decline seems excessive, the USD could first test the 7.2550 level before likely stabilizing. The next support level at 7.2400 is unlikely to be under threat. Resistance stands at 7.2750, and a breach of 7.2800 would indicate that the weakness has stabilized.”
1-3 Weeks Outlook: USD Downward Bias Towards 7.2400
1-3 Weeks View: “Since last Thursday (04 Jul, spot at 7.3000), we have expected the USD to trade between 7.2700 and 7.3100. After a period of quiet trading, the USD plunged to a low of 7.2584 yesterday. Downward momentum is building, and the USD is likely to trade with a downward bias towards 7.2400. This downward bias will remain intact as long as the USD stays below 7.2910.”
In summary, while the USD might see further short-term declines, analysts believe that significant support levels will prevent any major breakdown.
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