Japanese Yen: Consolidation before potential push to 160.55 against US Dollar – UOB

FXStreet Insights Team FXStreet

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report that USD/JPY has pulled back from 160.20, with intraday price action expected to stay between 159.50 and 160.15 as upward pressure eases. Over the next 1–3 weeks, they maintain a slightly positive stance, seeing scope for the pair to edge higher toward 160.55 as long as support at 159.20 holds. Longer-term, the uptrend remains intact above the 21-day EMA.

Dollar-Yen holds firm within tight band

"24-HOUR VIEW: Subsequent to last Friday’s sharp rise to 160.04, we highlighted yesterday, when USD was at 160.00, that “the rapid rise appears overdone, and USD is unlikely to rise much further.” We expected USD to “consolidate at these higher levels between 159.65 and 160.25.” USD did not quite consolidate as after rising to 160.20, it dropped sharply to 159.45 and then rebounded to close at 159.73 (-0.19%). Upward pressure has eased, but there has been no clear increase in downward momentum. Today, we expect USD to rangetrade, most likely between 159.50 and 160.15."

"1-3 WEEKS VIEW: We turned slightly positive on USD yesterday (31 Aug, spot at 160.00). We indicated that “upward momentum has increased, albeit only slightly.” We also indicated that “as long as USD holds above 159.20 (‘strong support’ level), it could edge higher toward 160.55.” Our view remains unchanged."

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