USD/JPY is expected to remain stuck within a range – UOB

Pablo Piovano FXStreet

USD/JPY is still seen trading within the 149.00-150.70 range in the next few weeks, according to UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia.

Key Quotes

24-hour view: We expected USD to trade in a range between 149.90 and 150.70 last Friday. However, USD fell to a low of 149.45 before ending the day on a soft note at 149.60 (-0.52%). Despite the relatively sharp drop, downward momentum has not improved much. That said, USD has scope to test 149.35 before the risk of a rebound increases. The major support at 149.00 is unlikely to come under threat. Resistance is at 150.00; a breach of 150.30 would mean that USD is not weakening further.

Next 1-3 weeks: Last Thursday (26 Oct, spot at 150.25), we highlighted that “while upward momentum is beginning to improve, in order for USD to advance in a sustained manner, it must break and stay above 150.50.” After USD rose to a high of 150.77 (and closed at 150.38), we highlighted on Friday that “upward momentum has not improved further, and the resistance level has moved higher.” We added, USD now “has to break clearly above 151.00 before a sustained advance is likely.” USD then dropped sharply to a low of 149.45. While our ‘strong support’ level at 149.35 has not been breached yet, upward momentum has largely dissipated. For now, USD is likely to trade in a range, probably between 149.00 and 150.70.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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