USD/JPY decline could extend to 106.00 – UOB

According to the research team at UOB Group, USD/JPY’s downside could test the 106.00 area.

Key Quotes

“The weak US nonfarm payrolls print last Friday sent the USD/JPY even further lower to the 106-levels. However, further downside could be limited as there is now increasing pressure on the BoJ to ease policy further with a move in June a possibility”.

“The expected extension to 108.20 turned into a rout as USD plummeted to a low of 106.48 last Friday. While severely over-extended, the current USD weakness could extend lower to 106.00 even though oversold shorter-term indicators suggest a slower pace of decline. Stop-loss for our bearish view is at 108.10 even though 107.50 is already a strong short-term resistance”.