In light of the recent price action, USD/JPY is now expected to extend the consolidation in the next weeks, likely between 113.20 and 114.70.

Key Quotes

24-hour view: “Yesterday, we highlighted that ‘there is room for USD to test 114.30’. We added, ‘the major resistance at 114.70 is not expected to come into the picture’. Our view was not wrong as USD rose to 114.44 before easing off to close little changed at 113.98 (-0.02%). Upward pressure has eased and USD is unlikely to strengthen further. For today, USD is more likely to trade sideways between 113.75 and 114.25.”

Next 1-3 weeks: “We continue to view the current movement in USD as part of a consolidation phase and USD is likely to trade between 113.20 and 114.70 for now.”