USD/JPY remains bearish near term – UOB

According to FX Strategists at UOB Group, the pair’s near term stance remains bearish, although a the likelihood of a visit to 107.30 seems to have lost some traction.

Key Quotes

24-hour view: “USD traded within a wider range than expected before ending the day on a positive note. From here, another attempt to test the 109.50 resistance seems likely (overnight high has been 109.44) but the next resistance at 109.75 is likely out of reach. Support is at 108.95 followed by 108.70”.

Next 1-3 weeks: “After touching a low of 108.27 last Friday, USD has been trading mostly sideways. While downward momentum is showing early signs of waning, it is too early to expect a low. The outlook for USD is still bearish even though as highlighted in recent updates, the next ‘target’ at 107.30 is unlikely to come into the picture so soon. On a shorter-term note, 108.00 is already a strong support. To put it another way, the current consolidation phase could last for a few days more and only a break of the ‘stop-loss’ at 110.30 (no change in level) would indicate that USD has made an interim low”.