According to UOB Group’s Economist Lee Sue Ann and Market Strategist Quek Ser Leang, USD/JPY should maintain the 130.50-134.50 range for the time being.

Key Quotes

24-hour view: “We highlighted yesterday that ‘Flat momentum indicators suggest further sideways trading, likely between 131.60 and 132.75’. USD subsequently traded within a narrower range of 132.05/132.87 but it opened on a soft note in early Asian trade. Downward momentum is beginning to build and USD is likely head lower. However, a sustained decline below 131.30 appears unlikely (next support is at 130.50). Resistance is at 132.30, a breach of 132.70 would indicate the build-up in downward momentum has fizzled out.”

Next 1-3 weeks: “There is not much to add to our update from Monday (09 Jan, spot at 132.10). As highlighted, after the sharp drop last Friday, USD is likely to trade within a broad range of 130.50 and 134.50 instead of rebounding further.”