USD/JPY keeps the side-lined trading so far – UOB

USD/JPY is still seen within the 126.90-129.40 range in the next weeks, suggested Lee Sue Ann and Quek Ser Leang, FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday that USD ‘could strengthen further’. We added, ‘only a breach of 128.30 would indicate that the current strong upward pressure has eased’. USD subsequently rose to 129.40, dropped sharply to a low 127.44 before rebounding. The price actions suggest that USD has likely moved into a consolidation phase. For today, USD is likely to trade sideways between 127.40 and 128.80.”

Next 1-3 weeks: “We highlighted yesterday (20 Apr, spot at 129.10) that there is no end in sight for the current USD rally. We added, ‘only a breach of 127.70 would indicate that the rally in USD is ready to take a breather’. In other words, we did not expect the subsequent sharp pullback to a low of 127.44. The current movement is viewed as the early stages of a consolidation phase and USD is likely trade within a range of 126.90/129.40 for now.”