Further decline in USD/JPY should meet initial and firm support at 130.15 ahead of 129.80, according to Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: “Yesterday, USD dropped to a low of 130.31. The low is not far above a major support level of 130.15. While downward momentum has waned somewhat, there is potential for USD to break 130.15 today. The next support at 129.80 is unlikely to come under threat. Resistance is at 131.00, a breach of 131.40 would indicate that the weakness in USD has stabilized.”

Next 1-3 weeks: “In our most recent update from Wednesday (22 Mar, spot at 132.50), we stated that the recent USD weakness has ended. Our call was premature as USD continues to drop as it fell to a low of 130.31 yesterday. Despite the decline, short-term conditions remain severely oversold. However, there is room for USD to weaken further though there are a couple of rather solid support levels at 130.15 and 129.80. On the upside, a breach of 132.50 would suggest USD is not weakening further.”