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28 Feb 2013
Forex Flash: USD/JPY expected to continue loitering - OCBC Bank
Emmanuel Ng of OCBC Bank is expecting USD/JPY to continue to loiter around current levels after failing to breach the 91.00 floor this week with investors unwilling to initiate a concerted move ahead of BoJ developments.
He sees immediate support around 91.40 while on the upside 93.00 may provide a near term cap. Shifting focus to AUD/USD, Ng notes that the pair bounced higher in early trading on Thursday, partly on the back of the positive tone in Asia and despite disappointing Q4 private capital expenditure numbers. Nonetheless, he writes, “We do not expect a resurgence of AUD strength with the RBA’s model showing the AUD was as much as 15% overvalued as at end-2012 and with the broad valuation of the AUD continually being called into question by policy makers. Near term, 1.0300 may cap while the downside may be tempered on approach of 1.0185.”
He sees immediate support around 91.40 while on the upside 93.00 may provide a near term cap. Shifting focus to AUD/USD, Ng notes that the pair bounced higher in early trading on Thursday, partly on the back of the positive tone in Asia and despite disappointing Q4 private capital expenditure numbers. Nonetheless, he writes, “We do not expect a resurgence of AUD strength with the RBA’s model showing the AUD was as much as 15% overvalued as at end-2012 and with the broad valuation of the AUD continually being called into question by policy makers. Near term, 1.0300 may cap while the downside may be tempered on approach of 1.0185.”