USD/JPY sticks to the neutral stance near term – UOB

USD/JPY is seen extending its neutral stance between 110.00 and 112.20 in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

“The target indicated at 110.35 yesterday was exceeded as USD hit a low of 110.24. The subsequent strong and rapid rebound from the low came as a surprise and suggests that a short-term low is in place. While extension higher towards 111.15/20 seems likely, the next resistance at 111.60 (high on Monday) is unlikely to come under serious threat”.

“We continue to hold the view that USD is trading in a 110.00/112.20 range and indicated yesterday that “it is more likely that we would see a move to 110.00 first”. USD touched an overnight low of 110.24 but downward momentum has waned considerably with the subsequent strong rebound. As long as 111.50 is intact, another push lower towards 110.00 is not ruled out but at this stage, we do not expect a sustained break below this level”.