USD/JPY: Longer term there is scope for a move toward 100 – CitiBank

Matías Salord FXStreet

Analysts at Citibank, see the USD/JPY trading at 106 in a three month period and at 103 between the next six to twelve months. In the short-term, they consider the pair could rise further.

Key Quotes:

“US-China tensions escalation and the concern of second wave crisis drove money flow into safe haven assets, which also support yen”.

“We think the Yen fairs well as the V shaped stocks recovery meets headwinds from 2nd waves. More longer term, we do see scope for a move down toward 100. We expect the BoJ to lift its short-term policy rate to 0% in October 2021, alongside a hike in its 10yr JGB yield target.”

“The pattern on USD/JPY now looks like an inverted head and shoulders with a neckline at 107.63. A break above would signal the potential for a move as high as the 06 April high at 109.38 again. However, USD/JPY is testing good resistance at 107.55/60 (55-day MA). A close below would suggest at least a pause in this rally”.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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