United Overseas Bank (UOB) analysts Quek Ser Leang and Lee Sue Ann report that the USD/JPY currency pair has pulled back from a recent high of 160.20, with intraday price action expected to remain within a tight range of 159.50 to 160.15 as upward pressure eases [1]. Following a sharp rise to 160.04 last Friday, the pair experienced volatility, dropping to 159.45 before rebounding to close at 159.73, representing a 0.19% decline [1].
Despite the recent pullback, UOB maintains a slightly positive outlook for the next one to three weeks, suggesting that as long as the USD/JPY holds above the 159.20 support level, there is scope for the pair to edge higher toward 160.55 [1]. The analysts note that the longer-term uptrend remains intact as long as the pair trades above the 21-day exponential moving average (EMA) [1].
For the immediate term, UOB expects the USD/JPY to range-trade, most likely between 159.50 and 160.15, as there is no clear increase in downward momentum despite the easing of upward pressure [1]. The analysts' view remains unchanged from their previous assessment, emphasizing the importance of the 159.20 support level for the continuation of the upward trend [1].
CONCLUSION
UOB analysts see the USD/JPY consolidating in a narrow range after recent volatility, but maintain a slightly positive outlook as long as key support holds. The potential for a move toward 160.55 remains, with the longer-term uptrend intact above the 21-day EMA. Market participants are likely to watch the 159.20 support level closely for signs of further direction.