The prospect of further gains in USD/JPY appears to have lost some momentum as of late, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “The muted price action in USD yesterday offers no fresh clues. Momentum indicators are mostly ‘neutral’ and USD could continue to trade sideways for today, likely between 107.60 and 108.00.”
Next 1-3 weeks: “After soaring to a high of 108.08 on Tuesday (18 May), USD has not been able to make any headway on the upside. The consolidation over the last couple of days has dented the upward momentum but for now, we are holding on to our view that USD ‘could head higher towards 108.50’. In order to invigorate the current flagging momentum, USD has to move and stay above 108.00 or a break of the ‘strong support’ at 107.15 (no change in level) would indicate that USD has moved into a consolidation phase. To look at it another way, the prospect for further USD strength has diminished.”
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