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USD/JPY looks firmer and could now set sails to the 108.40 region in the next weeks, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our view yesterday was that ‘barring a move below 107.30, USD could edge above 108.00’. While USD held above 107.30 (low of 107.51), it did not quite edge above 108.00 (overnight high of 107.98). The firm closing in NY (107.92) has resulted in further improvement in momentum and USD could strengthen from here. That said, 108.40 is likely out of reach for today. Support is at 107.65 followed by 107.30.”

Next 1-3 weeks: “USD moved above the top of our expected 106.40/107.80 range yesterday (high of 107.87). Upward momentum is beginning to improve and USD could strengthen towards 108.40. As the build-up in momentum is still in its nascent stage, it is too early to expect a sustained move towards 108.40. On the downside, a breach of 107.00 (‘strong support’ level) would indicate that the current upward pressure has eased.”