The US Dollar (USD) shows potential for further rebound, yet overbought conditions indicate that significant advances above the 158.00 mark are unlikely. According to UOB Group FX analysts Quek Ser Leang and Lee Sue Ann, a breach of 158.50 could signal a stabilization in USD weakness.
Short-Term Outlook:
In the 24-hour view, analysts acknowledged that their previous expectation for a USD decline was off the mark. Contrary to the anticipated drop, the USD rebounded strongly, ending at 157.37—a rise of 0.77%. Despite the potential for further gains, current overbought conditions suggest that the USD is unlikely to surpass 158.00. Immediate support levels are identified at 156.90 and subsequently at 156.30.
Medium-Term Perspective:
Looking at the 1-3 week forecast, the scenario has evolved since the previous assessment on July 12, when the USD was at 159.00. Analysts had noted the potential for the Japanese Yen (JPY) to continue weakening but were uncertain if it would reach the significant support level at 155.50. After the USD fell below this level, the focus shifted to potential further weakness, with key levels of 154.50 and 153.95 highlighted. The unexpected strong rebound to 157.37 suggests a shift, with a break above 158.50 indicating that the USD’s weakness may be stabilizing.
This analysis underscores the critical resistance levels for the USD and the potential signals of stabilization or further weakness depending on price movements in the coming days.
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