The upside bias in USD/JPY could extend to the 109.30 region in the next weeks, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “USD edged above 109.00 (high of 109.03) before ending the day on a solid note (108.94, +0.28%). The advance has picked up considerable momentum even though it may not be enough to crack the August’s peak near 109.30. Support is at 108.80 but only a move below 108.65 would suggest the current upward pressure has eased”.
Next 1-3 weeks: “We expected USD to trade sideways since last Monday (21 Oct, spot at 108.40). After trading sideways for about a week, it soared and cracked the 109.00 resistance yesterday (28 Oct) as it touched 109.03. Upward momentum has picked up and from here, we expect USD to trade with an upside bias towards the August peak near 109.30. At this stage, the prospect for a sustained advance above this level is not that high but it would continue to increase as long as 108.35 (‘strong support’ level) is intact. Looking ahead, the next resistance above 109.30 is at 109.60 followed by 110.00”.
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