Further USD/JPY decline is anticipated to meet next strong support at 134.00according to the UOB Group economist Lee Sue Ann and the market strategist Quek Ser Leang.
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24 hour view: “Yesterday, we indicated that “the strong downside momentum in USD/JPY is likely to continue.” We added that “support levels to watch are at 136.40 and 135.50.” USD/JPY removed both support levels by falling to New York session low of 135.20.While further weakness is not ruled out, the massive drop of the past two days is overstated and it remains to be seen if USD/JPY could challenge next support at 134.00 today. Resistance is at 135.90. A break of 136.50 would indicate that USD/JPY weakness has stabilized.”
Next 1-3 weeks: “We indicated yesterday (Dec 1, USD/JPY at 137.20) that strong downside momentum is likely to lead to further USD/JPY weakness to 136.40, even as low as 135.50. Although our view was correct, we did not expect 135.50 to be seen so soon, as USD/JPY plunged to a low of 135.20. Bearish momentum, not surprisingly, remains strong, but it remains to be seen if USD/JPY can keep up the frenetic pace of decline. To watch is at 134.00. To the upside, breaking above 137.05 (the “strong resistance” level was at 138.55 yesterday) would indicate that USD/JPY weakness has stabilized.”
Source: Fx Street
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