USD/JPY: Likely to trade in a range between 151.30 and 152.70 – UOB Group

US Dollar (USD) is likely to trade in a range between 151.30 and 152.70. In the longer run, the current price movements are likely the early stages of a 149.50/153.00 range-trading phase, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Current price movements are likely a part of a range-trading phase

24-HOUR VIEW: "The sharp plunge in USD that reached a low of 151.15 last Friday came as a surprise (we were expecting range-trading). While USD closed on a weak note at 151.15 (-1.25%), it opened sharply higher today. The immediate downward pressure appears to be easing, and instead of continuing to decline, USD is more likely to trade in a range today, expected to be between 151.30 and 152.70."

1-3 WEEKS VIEW: "Our most recent narrative was from last Wednesday (07 Oct, spot at 150.35), in which we highlighted that 'further USD strength is likely, and the level to watch is 153.80.' USD rose to a high of 153.27 on Friday, and then, in an abrupt reversal, plunged and closed lower by 1.25% (151.15). The breach of our ‘strong support’ at 151.40 indicates that the USD strength from early last week (as annotated in the chart below) has ended. The current price movements are likely to early stages of a range-trading phase, probably between 149.20 and 153.00."