USD/JPY stays rangebound and keeps targeting the mid-107.00s in the short-term horizon, in opinion of FX Strategists at UOB Group.
Key Quotes
24-hour view: “Last Friday, we expected USD to ‘move above the strong resistance at 107.15’. Our view was wrong as it plummeted to a low of 106.42 after touching 107.03. The build-up in upward momentum has dissipated and the current movement is viewed as part of a consolidation phase. In other words, USD is expected to trade sideways for today, likely between 106.30 and 106.90.”
Next 1-3 weeks: “On Wednesday (12 Aug, spot at 106.50), we noted the ‘rapid improvement in momentum’ and expected USD to ‘strengthen towards 107.15’. USD rose to a high of 107.04 yesterday (13 Aug) and from here, a move above 107.15 would not be surprising. The next resistance at 107.50 is a more formidable level and may not be easy to break. Overall, the current positive phase in USD is deemed as intact as long USD does not move below 106.20 (‘strong support’ level was previously at 105.85).”
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