The USD / JPY risks a potential drop to the 108.90 region over the next several weeks, UOB Group currency strategists suggest.
24 hour view: “We highlighted yesterday that ‘there is room for USD / JPY to move higher, but no advance is expected to break the main resistance at 109.85’. While our opinion was not wrong as USD / JPY rose to 109.79 , we do not anticipate the sharp decline from the high (the low has been 109.29). Despite the rapid decline, the bearish momentum has not improved much and the USD / JPY is unlikely to weaken much further. For today, it is more the pair is likely to trade between 109.20 and 109.60 “.
Next 1-3 weeks: “There is not much to add to our update on Wednesday (June 10, USD / JPY at 109.40). As highlighted, USD / JPY is under slight downward pressure and could drop to 108.90. On the upside, a breakout of 109.85 would indicate that the current slight downward pressure has eased. “