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FX Strategists at UOB Group noted USD/JPY should remain side-lined between 106.40 and 107.80 for the time being.

Key Quotes

24-hour view: “JPY dipped below the bottom of our expected 106.90/107.40 consolidation range but rebounded quickly after touching 106.78. While upward momentum has not improved by much, there is room for USD to edge higher towards 107.50. For today, the next resistance at 107.80 is unlikely to come into the picture. Support is at 107.00 followed by 106.80.”

Next 1-3 weeks: “The downward pressure in USD that started more than 2 weeks ago (see annotations in chart below) has ended when USD moved above the 107.20 ‘strong resistance’ level yesterday. From here, the outlook for USD is mixed and it could trade between 106.50 and 107.80 for a period.”