USD/JPY: Further rangebound lies ahead – UOB

USD/JPY should remain side-lined between 105.00 and 106.60 in the short-term horizon, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “In line with our expectation, USD traded sideways yesterday but the registered range of 105.28/105.69 was narrower than our expected range of 105.25/105.75. Indicators are mostly ‘flat’ and further sideway-trading would not be surprising. Expected range for today, 105.20/105.80.”

Next 1-3 weeks: “We highlighted on Monday (03 Aug, spot at 106.00) that the ‘outlook is unclear and USD could trade in a choppy manner within a broad 105.00/107.00 range’. However, USD traded in a relatively calm manner as it drifted lower over the past few days. The price action offers no fresh clues and for now, we continue to expect USD to consolidate, albeit within a narrower range of 105.00/106.00. Looking forward, only a clear break of 104.70 would indicate that USD is ready to tackle the 104.00 level.”