USD/JPY: Extra consolidation still on the table – UOB

USD/JPY is predicted to keep the 134.75-137.00 range well in place for the time being, noted FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.

Key Quotes

24-hour view: “We highlighted yesterday that USD ‘is likely to drift lower and test 135.10’. We added, ‘the major support at 134.75 is unlikely to come under threat’. However, USD declined more than expected as it dropped to 134.94 before rebounding strongly to end the day little changed at 135.93 (+0.04%). Downward pressure has eased and the current movement appears to be part of a consolidation phase. For today, and USD is likely to trade within a range of 135.30/136.30.”

Next 1-3 weeks: “We continue to hold the same view as from Tuesday (05 Jul, spot at 135.95). As highlighted, the current movement appears to be part of a broad consolidation phase and USD is likely to trade between 134.75 and 137.00 for now.”