USD/JPY to challenge 110 – TDS

By FXStreet FXStreet (Córdoba) – The Research Team at TD Securities, continue to see a bullish scenario for the Japanese yen and expects USD/JPY to challenge 110 in the weeks ahead.

Key Quotes:

“Our bullish JPY scenario continues to play out. While we cannot rule out some further correction off the sub-116 lows, we see further downside for USDJPY as Japanese equity markets have suffered steep declines.”

“The JPY’s fundamental backdrop has turned more constructive while we continue to expect the BoJ to remain side-lined. We expect a move down in USDJPY to challenge support around 110 in the weeks ahead.”

We continue to target a move down toward 110, with a possible extension lower. We note that 106.57 is the 38.2% retracement level of the entire 2011-2015 rally while the 105 region provided support to a modest pullback in October 2014.”

“We think the 118.10/40 region, corresponding to several local highs established in recent days, should cap any near-term rebound and provide an attractive entry point to strategic USDJPY shorts.”
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Source:: FX Street