Bullish USD/JPY, Bearish EUR/USD
eFXnews | Nov 03, 2014 03:11AM ET
Bank of America Merrill Lynch (NYSE:BAC) has been and remains USD bullish and now holds a strong bullish view for USD/JPY and bearish outlook for EUR/USD.
"Indeed, we think USD/JPY has further gains in store. The break of 2m channel resistance (now 111.79) clears the way above 112.42 (61.8% of the Jan’02/Oct’11 decline)," BofA argues.
This, according to BofA, should push USD/JPY toward 115.28/117.70 (long term retracement resistance and a host of measured moves).
"Back below 111.00 would indicate stalling, but STAY BULLISH against the last higher low of Sep-30 (now support) at 110.09," BofA advises.
Meanwhile, BofA notes that EUR/USD has made new lows since Aug/12.
"While 1.2470/50 should be strong support, it should ultimately give way for a deeper prove of the confluence of long term support between 1.2303/1.1876 (200m and Jun’10 low)," BofA projects.
"On a LONG TERM BASIS, weakness can extend to 1.1706, even POTENTIALLY 1.0550/1.0283 before all is said and done. However, we must stress that we must see much more before we can highlight the 1.0550/1.0283 zone with confidence. Right now it must be treated solely as a “possibility”," BofA adds.
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