24-hour view: Two days ago, USD plummeted to 145.89 and then rebounded. Yesterday, we highlighted that “the strong rebound in oversold conditions suggests USD is unlikely to weaken further.” We expected USD to trade in a range between 146.00 and 147.30. However, USD traded in a narrower range than expected (146.44/147.24). The underlying tone seems to have improved somewhat. Today, USD could edge higher, but it is unlikely to reach 147.80. On the downside, if USD breaks below 146.60 (minor support is at 146.85), it would mean that the current mild upward pressure has faded. 

Next 1-3 weeks: Yesterday (12 Sep, spot at 146.70), we highlighted that USD could pullback further. We added, “the likelihood of a clear break below 145.50 is not high.” We continue to hold the same view. On the upside, if USD breaks above 147.80, it would indicate that it is not ready to pullback further.