24-hour view: We expected USD to trade with an upward bias last Friday. However, we were of the view that “a sustained rise above 7.2200 is unlikely.” USD then soared to 7.2285 before pulling back to end the day at 7.2149 (+0.30%). The pullback in overbought conditions suggests USD is unlikely advance much further. Today, USD is more likely to trade in a range of 7.1950/7.2300.

Next 1-3 weeks: Last Friday (23 Jun, spot at 7.1960), we noted that “upward momentum has improved a tad”, and we held the view that “there is room for USD to edge higher to 7.2300.”. USD then rose to 7.2285 and then pulled back. While momentum has not improved much, USD could rise further, albeit at a slower pace. The next level to watch above 7.2300 is 7.2500. On the downside, a breach of 7.1700 (‘strong support’ level previously at 7.1580) would indicate USD is not advancing further.