Yen: USD/JPY Expected to Stay Range-Bound - UOB

UOB analysts Quek Ser Leang and Lee Sue Ann noted that USD/JPY remains in a range-trading phase, with recent movements offering no clear directional signal. At the time of writing, USD/JPY was trading around 158.95, little changed from earlier.

**Short-Term Trading Range Defined**

For the 24-hour outlook, the analysts expect USD/JPY to trade within a 158.95-159.50 range, given the recent narrow fluctuations and subdued closing moves. This assessment is based on a lack of momentum, with no catalysts to drive a breakout.

**Medium-Term Upside Bias Weakens**

For the 1-3 week outlook, UOB analysts see USD/JPY staying confined to a broader 157.90-159.80 range. They noted that the earlier drop to around 158.00 has weakened the previous upside bias. While downward momentum has built, it is not yet sufficient to sustain a prolonged decline. Therefore, any dips in the coming days are likely to be limited within the stated range rather than evolving into a one-way move.

**Long-Term Key Support in Focus**

Looking at the 1-3 month horizon, UOB maintains that as long as key support levels hold, USD/JPY retains room for further upside. This view suggests that despite cautious near-term sentiment, the bank has not turned bearish on the pair's longer-term trajectory, with the focus remaining on the effectiveness of downside support.