The constructive view in USD/JPY remains well and sound in the short-term horizon, noted FX Strategists at UOB Group.
24-hour view: “We expected USD to strengthen last Friday but we were of the view that ‘odds for a sustained advance above 104.75 are not high’. We highlighted that ‘105.00 is unlikely to come into the picture’. Our view was not wrong as USD rose to 104.94 before easing off to close at 104.68 (+0.45%). Overbought conditions suggest that further USD strength is unlikely. For today, USD is more likely to consolidate and trade between 104.40 and 105.00.”
Next 1-3 weeks: “Last Thursday (28 Jan, spot at 104.25), we highlighted that ‘risk for USD has shifted to the upside’ and we were of the view that ‘the solid resistance at 104.75 may not yield so easily’. However, USD popped to a high of 104.94 on Friday before easing off to close on a firm note at 104.68. Upward momentum has improved and USD is likely to strengthen further. That said, overbought shorter-term conditions could lead to a couple of days of consolidation first. Looking ahead, a clear break of 105.00 would shift the focus to 105.40. Overall, the current positive outlook for USD is deemed intact as long as USD does not move below 104.00 (‘strong support’ level previously at 103.75).”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.