30 Jan 2015
USD/JPY upside to remain capped – KBC
FXStreet (Barcelona) - The KBC Bank Research Desk prefers staying cautious on the USD/JPY pair, expecting the falling US and Euro yields to cap the topside for the pair.
Key Quotes
“We stay cautious on USD/JPY even as the pair held up well this week. The downtrend in core (USD-EUR) yields may continue to cap the topside. In addition, at some point, Asian/Japanese equities might become nervous on the ‘competitive’ devaluations in EMU and several other countries. A risk-off correction might bring the yen in the picture.”
“EUR/JPY already cleared the EUR/JPY 134 support area and extensively tested the 131.22 support (Dec 2013 low + MT Neckline).“
“The comparable range bottom in USD/JPY stands at 115.57. This level is still far away, but we keep an eye on it.”
Key Quotes
“We stay cautious on USD/JPY even as the pair held up well this week. The downtrend in core (USD-EUR) yields may continue to cap the topside. In addition, at some point, Asian/Japanese equities might become nervous on the ‘competitive’ devaluations in EMU and several other countries. A risk-off correction might bring the yen in the picture.”
“EUR/JPY already cleared the EUR/JPY 134 support area and extensively tested the 131.22 support (Dec 2013 low + MT Neckline).“
“The comparable range bottom in USD/JPY stands at 115.57. This level is still far away, but we keep an eye on it.”