Extra gains in USD/JPY are likely once the pair clear the 137.85 level in the next weeks, comment FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.

Key Quotes

24-hour view: “Last Friday, USD soared to a high of 137.23 before closing on a strong note at 136.93 (+0.77%). Not surprisingly, conditions are overbought but the advance in USD appears to have enough momentum to extend further. However, the major resistance at 137.85 is likely out of reach for today (there is another resistance at 137.50).  Support is at 136.80 followed by 136.40.”

Next 1-3 weeks: “The strong advance in USD last week is likely to extend to 137.85. Further extension is not ruled but USD has to break the major resistance at 137.85 before further USD strength is likely. Overall, the risk for USD is on the upside as long as it does not move below the ‘strong support’ level, currently at 135.90.”