USD/JPY: A move to 145.50 loses traction – UOB

USD/JPY now faces dwindling bets for a probable visit to the 145.50 region, suggest Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: We noted yesterday that “the price actions appear to be consolidative” and we expected USD to trade in a range of 144.20/144.80. Our view of consolidation was not wrong even though USD traded in a lower range than expected (144.07/144.74). The underlying tone appears to have softened, and USD is likely to edge lower today. However, any decline is expected to face strong support at 143.90. Resistance is at 144.60, followed by 144.80. 

Next 1-3 weeks: We continue to hold the same view as yesterday (05 Jul, spot at 144.50). As highlighted, the USD strength that started in the middle of last month is struggling to maintain its momentum. The prospect for the USD strength to extend to 145.50 appears to be low. All in all, only a break of 143.90 (no change in ‘strong support’ level) would suggest that the USD strength has come to an end.