USD/JPY downward pressure alleviated above 111.80 – UOB

FX Strategists at UOB Group keep the neutral stance on the pair, adding that the downside pressure should be mitigated above 111.80.

Key Quotes

24-hour view: “While USD traded sideways as expected, the registered range of 28 pips was much narrower than anticipated. The prolonged consolidation phase appears to be close to ending but USD has to break out of the 110.65/111.35 range to indicate that it is ready to embark on a sustained directional move. Meanwhile, USD could continue to trade between 110.65 and 111.30″.

Next 1-3 weeks: “USD continues to trade in a quiet manner and registered the narrowest 1-day range so far this year. As highlighted in recent updates, we continue to anticipate USD to test the month-to-date low at 110.25 even though after the muted price action over the past several days, the odds for such a move have diminished. That said, only a break of the ‘key resistance’ at 111.80 would indicate that the current downward pressure has eased (ideally, USD should stay below 111.50 from here)”.