Further consolidation is likely in USD/JPY for the time being, noted FX Strategists at UOB Group.
24-hour view: “Instead of ‘trading with a downside bias towards 109.30’, USD traded in a quiet manner between 109.55 and 109.87. Momentum indicators are mostly ‘neutral’ and USD is likely to continue to trade sideways, expected to be within a 109.50/109.90 range.”
Next 1-3 weeks: “USD traded in a quiet manner between 109.55 and 109.87 and registered an ‘inside trading day’ yesterday. The price action is not out of line from our expectation for last Wednesday (05 Feb, spot at 109.45) wherein USD ‘is expected to trade sideways for a period’, likely between 109.00 and 109.30 (narrowed from 108.30/110.30 previously). Looking forward, the top of the range at 109.30 appears to be more vulnerable but USD has to register a NY closing above this level or the next resistance at 110.65 is unlikely to come into the picture.”