Further upside in USD/JPY is still expected to retake the 134.00 region in the short-term horizon, note Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia at UOB Group.

Key Quotes

24-hour view: “We highlighted last Friday that ‘a break of 133.50 will not be surprising but the major resistance at 134.20 could be just out of reach’. While USD took out 133.50, it dropped quickly from 133.59. Upward momentum has barely improved and USD is unlikely to advance much further. Today, USD is more likely to trade between 132.55 and 133.55.”

Next 1-3 weeks: “Last Friday (30 Mar, spot at 132.60), we highlighted that the recent USD weakness has ended and the rebound in USD could extend to 134.20. We continue to hold the same view. The current upside pressure will remain intact as long as USD stays above 131.90 (‘strong support’ level was at 131.70 last Friday).”