United Overseas Bank (UOB) economists Quek Ser Leang and Lee Sue Ann have analyzed the recent movement in USD/JPY, noting that the currency pair rebounded from oversold levels but faces strong resistance at 159.60, with another resistance at 159.35 [1]. They expect USD/JPY to edge higher in the near term, but gains are likely to remain capped below 159.60 [1]. Support is identified at 158.90, and a breach of 158.65 would indicate a shift into range-trading [1].
The analysts highlighted that after USD/JPY dropped to 157.86 and rebounded, short-term oversold conditions could lead to a couple of days of range-trading. However, as long as the 159.60 resistance is not breached, there remains a chance for USD/JPY to test the downside at 157.50 within a 1–3 week horizon [1].
No change in their outlook was reported, emphasizing the persistence of downside risk despite the recent rebound [1].
CONCLUSION
UOB economists maintain a cautious outlook on USD/JPY, citing strong resistance at 159.60 and downside risk toward 157.50. The pair is expected to remain range-bound unless key levels are breached, signaling limited upside and ongoing market uncertainty.