The current upside bias in USD/JPY carries the potential to extend beyond the 114.00 yardstick in the next weeks, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “USD traded between 113.20 and 113.71 yesterday, narrower than our expected sideway-trading range of 113.10/113.75. USD traded on a firm note during early Asian hours as it rose above 113.80. Upward momentum has improved, albeit not by much and USD could rise but the major resistance at 114.20 is likely out of reach for today (minor resistance is at 114.00). Support is at 113.60 followed by 113.40.”

Next 1-3 weeks: “Our view from Tuesday (12 Oct, spot at 113.40) still stands. As highlighted, the recent impulsive surge suggests that further USD strength would not be surprising and the next resistance is at 114.20. The USD strength is deemed intact as long as it does not breach 113.00 (‘strong support’ level was at 112.80 previously). Looking ahead, the next resistance above 114.20 is at 114.55.”