USD/JPY now targets the mid-110.00s – UOB

Further gains could push USD/JPY to the 110.55 level in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “The strong surge in USD during NY session to 110.32 came as a surprise. While deeply overbought conditions suggest that USD is unlikely to advance much further, it is too soon to expect a pullback. For today, USD is more likely to trade between 109.95 and 110.35.”

Next 1-3 weeks: “After trading sideways and in a relatively quiet manner for a few days, USD rocketed to a high of 110.32 during NY session and closed at a 2-month high of 110.28. Strong boost in momentum suggests further USD strength even though overbought shorter-term condition is likely to slow the pace of any further advance. From here, a move to 110.55 would not be surprising but at this stage, it is premature to expect USD to move to late March high of 110.96. All in, the current upward pressure is deemed intact as long as USD does not move below the ‘strong support’ level (currently at 109.60).”