Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group hint at the probability of a move to the 135.00 region in USD/JPY in the short term.

Key Quotes

24-hour view: “Our view for USD to trade sideways was incorrect as it surged to a high of 134.05 before easing off to close at 133.40 (+0.59%). Upward momentum has improved, albeit not much. USD could continue to rise today but it is unlikely to challenge the major resistance at 135.00 (there is another rather strong level at 134.50). The upside pressure is intact as long as USD does not move below 132.55 (minor support is at 133.00).”

Next 1-3 weeks: “We highlighted yesterday (05 Jan, spot at 132.00) that ‘downward pressure appears to have eased and USD has likely moved into a consolidation phase’ and we expected USD to ‘trade between 129.50 and 133.50 for a period of time’. We did not expect the sharp rise in USD to a high of 134.05. Upward momentum is building and the current price actions are likely the early stages of a corrective rebound that could extend to 135.00. In order to keep the momentum going, USD should not move below the ‘strong support’ level, currently at 131.50, within the next few days.”