USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 103.78; (P) 104.18; (R1) 104.83; More.

USD/JPY's recent rally resumes today and extends further to as high as 105.70 so far. At this point, intraday bias remains on the upside as long as 104.54 minor support holds. Further rally should be seen towards the upper end of mentioned 104.96/108.59 resistance zone. On the downside, below 104.54 will turn intraday outlook neutral first. But still, further rally is in favor as long as retreat is contained above 103.16 support.

In the bigger picture, break of 103.59 cluster resistance, as well as 55 days EMA (now at 103.31) argues that a medium term bottom is in place after down trend from 124.13 has just met 76.4% retracement of 79.75 to 147.68 at 95.78. Focus is now on 108.59 resistance and break of which will break a series of lower highs, lower lows pattern that started at 124.13 and will confirm that this down trend has completed already. In such case, stronger medium term rebound should then be seen to retest 114.77 resistance first.

However, failure below 108.59, followed by break of 100.02 support will firstly indicate rebound from 95.77 has completed. Secondly, it will keep the lower higher, lower lows pattern intact and suggest that down trend from 124.13 is still in force.

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