USD/JPY keeps the focus on 110.00 – UOB

FX Strategists at UOB Group reiterated the relevance of the 110.00 handle in the near term.

Key Quotes

24-hour view: “The major 110.00 resistance was unchallenged as USD staged a quick turn-around after hitting a high of 109.82. While the rapid down move from the high appears to be running ahead of itself, further weakness towards the major support at 108.55/60 would not be surprising. At this stage, a clear break below this major support is not expected (next support at 108.30 followed by another strong level at 108.10). On the upside, the 109.82 high is not expected to come into the picture (109.30, 109.50 are already a strong resistances)”.

Next 1-3 weeks: “The key short-term resistance at 110.00 continues to hold as USD dropped sharply after touching a high of 109.82 yesterday. As highlighted in recent updates, USD is expected to stay under pressure unless it can reclaim 110.00. While the bias on the downside, 108.55/60 is expected to offer solid support and is unlikely to yield so easily. A clear move below this level would indicate that the year-to-date low at 108.10 would come under threat. On a shorter-term note, the 109.82 high is already a rather strong resistance”.