Chief Analyst at Danske Bank Allan von Mehren noted the pair is expected to trade in a consolidative theme within 111.65 and 114.65 in the next months.
“USD/JPY grinded lower yesterday amid negative risk sentiment. Overall, we still see USD/JPY within the range of 111.65-114.50 in coming months targeting 114 in 3M”.
“We see risk of a slight disappointment in the US CPI figure (due tomorrow), which could add further pressure on the cross near term. Speculative accounts are stretched short JPY, according to IMM, suggesting risks are skewed to the downside for USD/JPY from a positioning point of view”.
“Technically, next support levels seen at 113.09 (9 November low), 113 (figure) and 112.48 (17 October high)”.
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