Further upside could see USD/JPY revisit the 134.40 region in the next few weeks, note Economist Lee Sue Ann and Market Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: “Yesterday, we held the view that USD ‘is unlikely to advance much further’ and we expected it to consolidate and trade between 132.60 and 133.90. Our view of consolidation was not wrong even though USD traded in a narrower range than expected (132.96/133.80). Upward momentum appears to be building again but while USD is likely to trade with an upward bias, it is unlikely to break the major resistance at 134.40 today. Support is at 133.20, followed by 132.70.”

Next 1-3 weeks: “Our update from yesterday (11 Apr, spot at 133.30) is still valid. As highlighted, further USD strength is not ruled out but overbought short-term conditions could lead to a couple of days of consolidation first. Overall, as long as 132.20 (‘strong support’ level was at 132.00 yesterday) is not breached, USD could rise to 134.40 later on.”