USD/JPY neutral stance near term – UOB

FX Strategists at UOB Group noted the pair should remain within a 113.60/116.60 range in the next 1-3 weeks.

Key Quotes

“USD traded at a narrower range than expected but the positive daily closing suggests that the risk is tilted to the upside from here. That said, any up-move is unlikely to have enough momentum to move clearly above the strong 115.25 resistance (next resistance is at last Friday’s peak near 115.50)”.

“We highlighted last Friday that only a clear break of 115.60 would shift the current neutral outlook to bullish. While a failure to move above this level was not unexpected, the sharp and rapid drop from a high of 115.50 came as a surprise. The recent build-up in upward momentum has eased and while the undertone is still generally positive, USD appears to have move into a 113.60/115.60 consolidation range that could last for several days”.