USD/JPY now faces some consolidation near term – UOB

Pablo Piovano FXStreet

In the opinion of Markets Strategist Quek Ser Leang and Economist Lee Sue Ann at UOB Group, USD/JPY is now seen navigating within the 149.50-151.65 range in the next few weeks.

Key Quotes

24-hour view: We expected USD to trade in a range of 151.05/151.95 yesterday. However, it dropped to a low of 150.14 in NY trade. The rapid decline appears to be overdone, and USD is unlikely to weaken much further. Today, USD is more likely to trade sideways between 150.10 and 151.25.

Next 1-3 weeks: We have held a positive USD view since the middle of last week. Yesterday (14 Nov, spot at 151.60), we indicated that “the risk is for USD to break clearly above 151.95 and head towards 152.50.” We did not anticipate the sharp drop that took out our ‘strong support’ level at 150.70 (low has been 150.14). Upward pressure has faded with the breach of the ‘strong support’. While downward pressure has increased; it is not enough to suggest the start of a sustained decline in USD. For the time being, USD is more likely to trade in a range of 149.50151.65. Looking ahead, only a clear break below 149.50 would indicate that USD is ready to head lower in a sustained manner.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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