USD/JPY now faces extra consolidation – UOB

UOB Group’s FX Strategists now see USD/JPY trading between 108.50 and 109.95 in the next weeks.

Key Quotes

24-hour view: “USD traded mostly sideways between 109.19 and 109.65 last Friday. Momentum indicators are mostly neutral and further sideway-trading would not be surprising. Expected range for today, 109.05/109.60.”

Next 1-3 weeks: “Our latest narrative was from last Wednesday (12 May, spot at 108.70) where we highlighted that ‘downward bias is intact but prospect for USD to move to 108.20 has diminished somewhat’. However, USD subsequently rebounded strongly but so far has not been able to build on its advance. In other words, USD is likely not ready to move higher in a sustained manner. From here, USD is more likely to consolidate and trade between 108.50 and 109.95.”