USD/JPY neutral, looks to 110.00 near term – UOB

FX Strategists at UOB Group noted the 110.00 handle should be back on the radar on a close above 109.30 in the short-term.

Key Quotes

24-hour view: “We highlighted yesterday that “a move above 109.00 would not be surprising” but noted that the strong 109.30 resistance is “unlikely to yield so easily”. USD subsequently rose to a high of 109.19 before easing off quickly. The 109.19 high is deemed as a short-term top and we do not expect this level to come into the picture for today. USD is more likely to consolidate its gains over the past couple of days and trade sideways. Expected range for today; 108.45/109.05”.

Next 1-3 weeks: “We highlighted yesterday that there is “room for further extension to 109.30” and USD subsequent hit a high of 109.19. Despite the pullback from the high, the current undertone remains solid and we continue to expect USD to stay supported for now. A break of 109.30 would indicate that USD is ready for a move to 110.00. Only a break of 108.15 (‘key support’ previously at 107.80) would indicate that a top is in place”.