USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 95.60; (P) 96.05; (R1) 96.80; More.

Prior break of 95.56 resistance in USD/JPY suggests that fall from 98.87, which is treated as the fifth leg in the triangle consolidation, has finally completed. Intraday bias is now on the upside and further rise should now be seen to 98.87 resistance first. On the downside, below 96.16 minor support will turn intraday outlook neutral again but pull back should be contained well above 94.87 support and bring another rally.

In the bigger picture, price actions from 99.67 are treated as consolidation in the larger up trend from 87.12 only, in form of triangle pattern. Fall from 98.87 is viewed as the final leg of such consolidation and should be contained above 93.84 support to conclude the consolidation. Break of 98.87 will be an important signal that whole rally from 87.12 is resuming and break of 101.43 will path the way to next key level at 110.65. However, note that a break below 93.58/84 support zone will invalidate the bullish case. Instead, it will revive the bearish case that USD/JPY has completed a head and shoulder top (ls: 99.67, h: 101.43, rs: 98.87) and will in turn indicate that whole down trend from 124.43 is still in progress.

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