Japanese Yen: Weak tone within defined trading band against US Dollar – UOB

United Overseas Bank’s (UOB) Quek Ser Leang highlights that USD/JPY is trading firmly after a sharp rise, with intraday bias tilted higher toward 162.70 while major resistance at 163.00 is expected to hold. On a 1–3 week horizon, the bank sees a mixed outlook with the pair likely confined between 160.60 and 163.00, though the medium-term trend can extend if above 161.00.

USD/JPY upside bias capped below 163.00

"24-HOUR VIEW: Two days ago, USD soared to a high of 162.42. Yesterday, we highlighted the following: “The rapid rise appears excessive, and the pullback from overbought conditions suggests limited further upside for USD. Today, USD could trade in a range between 161.50 and 162.45.” USD then traded within a narrower range than expected (161.66/162.18) before closing marginally higher by 0.01% at 162.09. USD traded on a firm note in the early Asian trade today, and the bias appears to be tilted to the upside. That said, any advance is likely to be limited to a test of 162.70. We do not expect the major resistance at 163.00 to come under threat. Support is at 162.00, followed by 161.80."

"1-3 WEEKS VIEW: Our update from yesterday (07 Jul, spot at 162.10) remains valid. As highlighted, the outlook for USD “is mixed,” and it could “trade between the two major levels of 160.60 and 163.00.”"

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)