USD/JPY: Likely to trade in a range between 146.55 and 149.55 - UOB Group

Rapid advance in US Dollar (USD) has scope to test 148.80 before leveling off; 149.55 is unlikely to come under threat. In the longer run, outlook is mixed; USD could trade in a range between 146.55 and 149.55 for now. USD surged last Tuesday, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Outlook for USD/JPY is mixed

24-HOUR VIEW: "Last Friday, USD dropped sharply to a low of 146.80 before staging a sharp rebound and closing at 147.38 (-0.74%). USD continues to rise as it opened with a gap higher today. The rapid advance has scope to test 148.80 before leveling off. Even if USD breaks above 148.80, it is unlikely to threaten the major resistance at 149.15. On the downside, support levels are at 147.90 and 147.50."

1-3 WEEKS VIEW: "In our latest update from Wednesday (30 Sep, spot at 148.55), we highlighted that 'while the outlook for USD is positive, it remains to be seen if it can maintain the rapid pace of advance.' We added, 'the level to watch is 149.55.' USD subsequently rose to a high of 149.13, but last Friday, it plummeted and broke below our 'strong support' level. Having come off the previous strong advance, the sharp drop last Friday did not translate into a meaningful build-up in downward momentum. Additionally, USD gapped higher on the open today. The sharp but short-lived swings have resulted in a mixed outlook. For now, USD could trade in a range between 146.55 and 149.55."