US Dollar (USD) is likely to trade in a range between 146.70 and 148.20. In the longer run, further USD strength is likely, but it could first trade in a range for a few days; the level to monitor is 149.30, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

USD/JPY can first trade in a range for a few days

24-HOUR VIEW: "Following the 2.14% surge in USD on Monday, we indicated yesterday, Tuesday, that 'The outsized rise appears excessive.' We added, 'This, combined with deeply overbought conditions, suggests that instead of continuing to rise, USD is more likely to trade in a 146.50/148.60 range.' USD then traded between 147.35 and 148.48. The price movements still appear to be part of a range trading phase. Today, we expect USD to trade between 146.70 and 148.20."

1-3 WEEKS VIEW: "There is not much to add to our update yesterday (13 May, spot at 147.90). As highlighted, 'while the sharp and rapid increase in momentum suggests further USD strength, deeply overbought conditions could lead to a few days of range trading first.' We also highlighted that 'The level to monitor on the upside is 149.30.' We will continue to hold the same view as long as 146.00 (no change in ‘strong support’ level) is not breached."