The US Dollar (USD) is showing strong momentum, leading to further strength in the currency. The resistance level at 145.50 is likely out of reach, according to UOB Group FX strategists Quek Ser Leang and Peter Chia. The analysts believe that the USD could recover further to 145.50 in the longer run, supported by a sharp advance in recent trading sessions.
In the short-term, the USD is expected to trade in a range of 141.50 to 143.80. However, a dip to 141.72 was followed by a strong surge to 144.49, indicating that the USD is exhibiting strong momentum. Although the rally is reaching overbought levels, further strength is expected. It is unlikely that the USD will reach the major resistance level of 145.50, with another resistance level at 144.80. To maintain the positive momentum, the USD must stay above 143.10, with minor support at 143.60.
Looking ahead to the next 1-3 weeks, the analysts suggest that if the USD can break above 144.00, it could trigger a stronger recovery towards 145.50. The recent sharp advance in the USD reinforces the view that it could indeed recover further to 145.50. The analysts have adjusted the strong support level to 141.90, up from 141.00, indicating that the USD is well supported in the current uptrend.
Overall, the USD’s strong momentum suggests that further strength is likely in the near term. The currency’s ability to maintain above key support levels and resistances will be crucial in determining the extent of its recovery. With the potential to reach 145.50 in the longer run, investors and traders will be closely monitoring the USD’s performance in the coming weeks to capitalize on potential opportunities in the currency markets.
