If USD/JPY manages to clear the 106.70 level, then the focus of attention should shift to the 106.00 zone, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “Our expectation for USD to ‘dip below last week’s 106.56 low’ did not materialize as it rebounded from 106.65. Downward pressure has eased and for today, USD is likely to consolidate and trade between 106.70 and 107.20.”
Next 1-3 weeks: “After closing largely unchanged for 3 days in a row, USD slipped and closed down by -0.30% yesterday (17 Jun). Downward momentum is showing sign of picking up but as highlighted since last Thursday (11 Jun, spot at 107.05), USD has to close below 106.70 before a sustained decline can be expected. The prospect for such a move has increased and would continue to increase as long as USD does not move back above 107.60 (‘strong resistance’ level previously at 108.00). Looking forward, if USD closes below 106.70, it could weaken towards last month’s low near 106.00.”
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