USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 97.89; (P) 99.81; (R1) 101.03; More.

USD/JPY recovers mildly after reaching as low as 97.91. While some volatility might be seen, short term outlook remains bearish as long as 101.48 resistance holds. The fall from 110.66 is expected to extend further to have a test on 95.77 low at least. On the upside, above 101.48 will turn short term outlook neutral and bring some more consolidation before resuming the decline.

In the bigger picture, medium term rise from 95.77 have completed at 110.66 with bearish divergence condition in daily MACD. Also, the three wave structure of such rise argues that it's just correction, or part of the correction to the longer term down trend from 124.13. Hence, deeper fall is now expected to retest 95.77 low. On the upside, above 106.14 will turn outlook mixed again and revive the case the rebound from 95.77 is possibly still in progress.

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