USD/JPY is now targeting the 109.00 handle in short-term, said FX Strategists at UOB Group.
Key Quotes
24-hour view: “Expectation for “further gain in USD“ did not really materialize as it traded in a relatively subdued manner between 108.55 and 108.82. While further sideway trading appears likely, the slightly weakened underlying tone could lead to a lower trading range of 108.40/108.80″.
Next 1-3 weeks: “We indicated on Wednesday (24 Jul, spot at 108.20) that “while the underlying tone has improved, only a NY closing above 108.60 would indicate that USD is ready to challenge the early July peak near 109.00″. That said, the sudden and strong surge in USD that hit an overnight high of 108.75 was not exactly expected (NY close of 108.62, +0.41%). From here, as long as 108.10 is not taken out, USD is expected to test the solid 109.00 resistance. At this stage, it is not very clear if USD can maintain a toehold above this level. The price action over the next few days should provide us with a better clue”.
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