USD/JPY now looks to the 104.00 level – UOB

USD/JPY stays on the defensive and remains focused on the 104.00 area, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday that ‘there is scope for USD to test 104.20 first before weakness should stabilize’. However, USD traded between 104.45 and 104.92 before closing at 104.82 (+0.25%). The current movement is viewed as part of an on-going consolidation even though the slightly firmed underlying tone indicates that USD is likely to trade within a higher range of 104.55/105.15 for today.”

Next 1-3 weeks: “After trading in a quiet manner for several days, USD jolted awake and plunged to a low of o104.32. While the sudden and sharp drop appears to be running ahead of itself, there is no denying that downward momentum has improved considerably. That said, it is left to be seen if USD can crack the September’s low near 104.00. Overall, USD is expected to stay on the defensive unless it can move above 105.40 (‘strong resistance’ level).”