The currency increased from a three-week low versus the yen as a chart traders use to predict price movements signaled last week's 2.4 percent decline was too large to be sustained. The yen dropped against the South African rand and the Brazilian real as speculation the worst of the financial crisis is over led investors to buy higher-yielding assets funded in Japan.
The dollar climbed 0.8 percent to 103.65 yen at 9:46 a.m. in New York, from 102.87 on May 9. It was the biggest gain since April 18. The euro increased 0.7 percent to 160.37 yen, from 159.21 yen, the largest one-day advance since April 16. The dollar traded at $1.5475 per euro, compared with $1.5482.
The U.S. currency has rallied 3.5 percent since touching the all-time low of $1.6019 per euro on April 22. The dollar gained momentum late last month after the Federal Reserve Open Market Committee said ``substantial'' rate cuts since September would help foster growth. The dollar got a further boost from a Labor Department report showing U.S. employers eliminated fewer jobs in April than economists forecast.
The Dollar Index traded on ICE futures in New York, which tracks the dollar against currencies of six trading partners, rose to 73.214 today, from 73.050 on May 9. It dropped to a record of 70.698 on March 17. The U.S. currency strengthened 0.6 percent to 1.0477 versus the Swiss franc.
The U.S. currency's 14-day stochastic oscillator versus the yen was 8.1 on May 9 and 35.67 today, according to data compiled by Bloomberg. A level below 20 suggests the currency has fallen too fast. The chart measures the closing price of a currency relative to its highs and lows during a particular period to predict whether it will rise or fall.