US Dollar (USD) is expected to trade in a range between 7.1340 and 7.1480. In the longer run, upward momentum is starting to build; for a continued advance, USD must first break clearly above 7.1480, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Upward momentum is starting to build

24-HOUR VIEW: "When USD was at 7.1400 in the early Asian hours yesterday, we were of the view that USD 'could continue to rise toward 7.1480.' We were also of the view that 'a sustained rise above this level is unlikely.' Our assessments were not wrong, as after rising to a high of 7.1502, USD retreated and closed largely unchanged at 7.1416 (+0.08%). There has been no further increase in upward momentum, and today, instead of expecting USD to rise, we expect it to trade in a range between 7.1340 and 7.1480."

1-3 WEEKS VIEW: "Last Tuesday (30 Sep, spot at 7.1275), we highlighted that 'the current price movements are likely part of a range-trading phase between 7.1000 and 7.1480.' Yesterday, we indicated that 'upward momentum is starting to build.' However, we pointed out that 'for a continued advance, USD must first break and hold above 7.1480.' We added, 'the odds of a clear break above 7.1480 will increase in the next few days as long as USD holds above 7.1250.' Although USD subsequently rose above 7.1480 (high was 7.1502), it pulled back and closed at 7.1416 (+0.08%). There has been no further increase in upward momentum, but there is still a chance for USD to break and hold above 7.1480 as long as 7.1250 holds."