US Dollar (USD) could edge lower vs Japanese Yen (JPY), but any weakness is viewed as a lower 148.00/150.00 range. In the longer run, failure to hold below 148.50 suggests USD could enter a period of indecision, trading in a 148.00/151.50 range for now, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Below 148.00, USD/JPY can see a sharp decline
24-HOUR VIEW: “After choppy price action two days ago, we indicated yesterday that ‘the outlook is unclear,’ and we held the view that USD ‘could trade between 148.80 and 150.70.’ USD then traded in a 148.38/150.18 range, closing at 148.88 (-0.61%). The price action has resulted in a slight increase in downward momentum. Today, there is room for USD to edge lower, but we view any weakness as part of a lower 148.00/150.00 range. We do not expect USD to break clearly below 148.00.”
1-3 WEEKS VIEW: “Our update from yesterday (05 Mar, spot at 149.85) remains valid. As highlighted, the recent failure to hold below 148.50 suggests USD ‘could enter a period of indecision, trading in 148.00/151.50 for now.’ Looking ahead, should USD break decisively below 148.00, it could potentially trigger a sharp decline.”
