A test of 113.00 is likely once USD/JPY breaches the 113.40 level in the short term, commented FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected USD to ‘trade sideways between 113.60 and 114.20’ yesterday. USD subsequently traded within a lower range than expected (113.46/113.99). The price actions offer no fresh clues and USD could continue to trade sideways, albeit at a higher range of 113.65/114.20.”

Next 1-3 weeks: “Our view from last Friday (21 Jan, spot at 113.90) still stands. As highlighted, shorter-term downward momentum has improved but USD has to break 113.40 before a decline to 113.00 is likely. The chance for USD to break 113.40 is not high (note that USD rebounded after touching 113.46 yesterday) but it would increase further as long as USD does not move above 114.45 (no change in ‘strong resistance level’).”