FX Strategists at UOB Group noted USD/JPY should remain within a consolidative theme for the time being.
24-hour view: “Expectation for USD to “test the 105.60 support” was incorrect as it rebounded strongly to 106.43. While upward momentum has not improved by much, the recovery has room to extend higher. That said, last week’s top near 106.70 is likely out of reach. Support is at 106.20 followed by 105.95”.
Next 1-3 weeks: “After the spectacular rebound from 104.44 last Monday (Aug 26), the price action in USD has been mixed. The movement offers no fresh clues and for now, we continue to hold the same view since 27 Aug (spot at 106.00) wherein USD is expected to “trade sideways and within a broad range between 105.00 and 107.00 for a while more”.