USD/JPY risks further downside – UOB

USD/JPY could extend the downside to the 107.00 neighbourhood in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected USD to ‘drop further to 108.30’ last Friday but it plunged to 107.74 before closing at 107.89 in NY (-1.54%). USD opened on a weak note this morning and the risk for today is still on the downside. From here, barring a move above 108.30, USD could dip below 107.00. For today, the next support at 106.60 is likely out of reach.”

Next 1-3 weeks: “We highlighted last Friday (27 Mar, spot at 109.70) that ‘a short-term top is in place’ and added, ‘USD could weaken further to 107.00’. From here, 107.00 appears to be within reach. The next support level of note below 107.00 is nearer to 105.90. On the upside, the ‘strong resistance’ level has moved lower to 109.80 from Friday’s level of 110.60.”