USD/JPY now faces some consolidation – UOB

According to FX Strategists at UOB Group, USD/JPY is forecast to keep the consolidative mood well and sound for the time being and likely within the 113.20-114.70 range.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the risk is still on the downside but any weakness is unlikely to break the major support at 113.20’. Our expectations did not materialize as USD traded between 113.45 and 113.90. Momentum indicators are turning flat and USD is likely to trade sideways for today, expected to be within a range of 113.55/114.00.”

Next 1-3 weeks: “There is no change in our view from last Friday (22 Oct, spot at 114.00). As highlighted, the recent USD strength has come to an end. The current movement is viewed as part of a consolidation phase and USD is likely to trade between 113.20 and 114.70 for now. Looking ahead, a clear break of 113.20 could trigger a sizeable pullback in USD.”