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In view of FX Strategists at UOB Group, a sustainable upside in USD/JPY could be triggered on a break above 108.80.

Key Quotes

24-hour view: “The strong and sudden surge last Friday appears to be over-extended. While USD could edge above last Friday’s 108.63 top, last month’s peak near 108.80 is a solid resistance and is unlikely to yield so easily. Support is at 108.25 but only a move below 108.00 would indicate that the current upward pressure has eased”.

Next 1-3 weeks: “Our view for USD to test the bottom of the expected 107.20/108.30 sideway-trading range first did not materialize as it surged to a high of 108.63 last Friday. Upward momentum has improved and USD is expected to stay supported for now. That said, it has to move and stay above 108.80 in order to suggest that it is ready to move higher in a sustained manner. On the downside, a break of the strong support at 107.75 would indicate that the current upward pressure has eased”.