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In opinion of FX Strategists at UOB Group, USD/JPY now remains focused on the key level at 104.00.

Key Quotes

24-hour view: “USD traded between 104.53 and 104.93 last Friday, narrower than our expected consolidation range of 104.55/105.15. The underlying tone has weakened a tad and while USD could drift downwards from here, any weakness is viewed as a lower trading range of 104.40/105.00. In other words, a sustained decline below 104.40 is not expected.”

Next 1-3 weeks: “There is not much to add to our latest narrative from last Thursday (22 Oct, spot at 104.65). As highlighted, USD “is expected to stay on the defensive but it is left to be seen if it can crack the September’s low near 104.00”. On the upside, a break of 105.40 (no change in ‘strong resistance’ level) would indicate the current downside risk has dissipated.”