An additional movement in range in USD / JPY remains on the table on the short-term horizon, say UOB Group currency strategists.
24 hour view: “We highlighted yesterday that ‘the underlying tone has strengthened, but any advance in USD / JPY is likely to be limited to a test of 109.80’. We added, ‘the higher resistance at 110.00 is not expected to enter the picture.’ USD / JPY rose to 109.88 before reversing. The upward pressure has dissipated somewhat and USD / JPY is unlikely to strengthen further. For today, USD / JPY is more likely to consolidate and move between 109.40 and 109.85 “.
Next 1-3 weeks: “There is not much to add to our update on Tuesday (June 1, USD / JPY at 109.45). As highlighted, the recent strength in USD / JPY has ended earlier than expected and the pair is likely to consolidate and move between 108.80 and 110.00 for now. “