USD/JPY strength has extended to our target of the 38.2% retracement of the 2022/2023 fall and 200-Day Moving Average at 136.67/137.20. But analysts at Credit Suisse continue to look for a cap here and for the broader risk to turn lower again.

Close above 137.20 to open up further gains

“USD/JPY has extended its recovery to our target of. With the prior oversold condition now unwound, we continue to look for the 200-DMA and 38.2% retracement of the 2022/2023 fall at 136.67/137.20 to cap and for the broader risk to turn lower again.”

Below support at 134.05 is needed to add weight to our view, with support then seen next at 132.25/20, ahead of 129.80 and eventually 127.53/23 again.”

“Above 137.20 on a closing basis would suggest a more important low was established in January and strength can extend further with resistance next at 139.54/59.”