UOB Sees USD/JPY Rising above 155.00, But Short-Term Targets Elusive

UOB's Quek Ser Leang is revising their forecast for the USD/JPY currency pair, citing fading downward momentum and increased upward pressure. In a report to FXStreet, Leang notes that despite earlier expectations of a decline, the pair reversed course and rose sharply from 153.29 to 154.99 before closing at 154.35 (+0.53%). The bank now sees scope for a move above 155.00, but believes that reaching 155.50 will be challenging in the near term.

Leang also points out that the downward momentum has slowed, and there is a buildup of upward momentum. As such, they expect USD/JPY to edge higher over the next 1-3 weeks, but remain confined within a range of 153.30-156.30. They emphasize that a breach of 153.90 would indicate eased upward pressure.

UOB's revised forecast marks a shift from their earlier bearish stance on USD/JPY, which they have been holding since early this month. Last Tuesday, the bank indicated that the price action suggested USD was likely to continue weakening and reach the year-to-date low of 152.08. However, after the pair rebounded, Leang highlighted that downward momentum was slowing, and the odds of reaching 152.08 were diminishing.