USD/JPY: Likely to remain bid in the short term – OCBC
Japanese Yen (JPY) has come off by about 3%, post-LDP vote over weekend. USD/JPY was last at 152.78 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.
USD/JPY has yet to be met with strong MoF rhetoric
"Markets have pushed out rate hike expectations, only fully pricing in a 25bp hike in Mar next year. So far, the move higher in USD/JPY has yet to be met with strong MoF rhetoric. The comments from Kato yesterday – that they are watching markets – is perceived as weak jawboning."
"Given the uncertainties, USD/JPY may still trade with a bid tone in the interim unless USD falls in a significant way or if there is stronger verbal intervention. Daily momentum is bullish while RSI rose. Golden cross looks on track to be formed, where 50 DMA cuts 200 DMA to the upside."
"Risks skewed to the upside in the interim. Resistance at 153.10, 154.40 (76.4% fibo retracement of 2025 high to low). Support at 151.60 (61.8% fibo), 150 levels."
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