The outlook on USD/JPY remains soft but a drop to the 103.18 level looks unlikely in the short-term horizon, in opinion of FX Strategists at UOB Group.
Key Quotes
24-hour view: “We expected USD to weaken yesterday but held the view that ‘a sustained decline below the solid support at 103.75 is unlikely’. USD subsequently dropped to a low of 103.63 before rebounding. Downward momentum is beginning to wane and the odds for further USD weakness are low. That said, it is too early to expect a sustained recovery. USD is more likely to consolidate and trade sideways, expected to be within a 103.70/104.20 range.”
Next 1-3 weeks: “Two days ago (17 Nov, spot at 104.45), we indicated that ‘there is a slight downward bias in USD but any weakness is viewed as part of a lower trading range of 103.75/105.20’. We added, USD ‘has to close below 103.75 in order to indicate that it is ready to move towards last week’s low at 103.18’. USD dropped to a low of 103.63 yesterday before rebounding. While the underlying tone still appears soft, the prospect for USD to move to 103.18 from here is not high. That said, only a break of 104.50 would indicate the current mild downward pressure has eased.”
Share
