24-hour view: Yesterday, we stated that “the outlook appears to be mixed” and we expected USD to trade in a range of 139.20/140.40. USD then traded in a narrower range than expected (139.27/140.27) before closing little changed at 140.09 (-0.090%). Despite the quiet price actions, upward momentum appears to be building, and USD is likely to trade with an upward bias today. However, it is unlikely to break the major resistance at 141.00. On the downside, a breach of 139.60 (minor support is at 139.95) indicates that the buildup in momentum has faded. 

Next 1-3 weeks: Our most recent narrative was from last Thursday (08 Jun, spot at 139.95) wherein USD “is likely to trade between 138.50 and 141.00”. After trading within the range for a week, short-term upward momentum appears to be building. However, for USD to advance in a sustained manner, it must break clearly above 141.00. The chance of USD breaking above 141.00 will remain intact as long as it stays above the ‘strong support’ (currently at 139.30) in the next few days.