Further Decline In Usdjpy

Further Decline In Usdjpy by Ashly Chole last updated on December 03, 2023

Further Decline In USD/JPY If 148.90 Support Fails - UOB

According to Lee Sue Ann from UOB Group, the USD/JPY pair will experience further decline if the 148.90 support fails.

Last Friday, UOB added that the USD/JPY will likely weaken if it stays under 151.30. At the same time, they expressed their view that the Dollar/Yen pair will not break the 150.10 support level.

It looks like the UOB's forecast was right to an extent, as the USD showed weakness on Friday. However, the weakness continued even further and pushed the pair towards 149.12. Although the pair has recovered from its lows, it is still in the oversold territory.

USD/JPY At Risk Of Further Downside

Today, the USD/JPY will likely trade between the 149.40 - 150.60 range. If we measure this range, that's almost 120 pips, which appears to be moderate.

If we look back, the last upward move of USD/JPY showed weakness, which allowed the UOB group to forecast weakness during Friday's session. Looking ahead, it looks like the pair will likely experience more downside in the next few weeks.

But as far as a sustained downside move is expected, the chances are lower as the bearish momentum is not that strong. In the next few weeks, the USD/JPY will need to break the 148.90 support to extend the downside further.

But if the 148.90 support holds and doesn't allow the bears to take charge, it will allow the pair to recover a little bit. But it doesn't mean that the bearish momentum will completely fade away in the USD/JPY.

As long as the Dollar/Japanese Yen doesn't cross the 151.10 resistance zone, the 148.90 support will remain on the cards. If the 148.90 is pierced with enough momentum, the next stop for the USD/JPY will be 148.50, followed by 148.20 and then 148.00.

On the top side, the next important resistance after the 151.10 is the 151.50 level, which will likely hold any bullish advances in the USD/JPY.