Daily Pivots: (S1) 112.49; (P) 112.68; (R1) 113.02; More..
USD/JPY’s fall from 112.88 extended lower today and focus is now on 111.94 minor support. Break should confirm that corrective rise from 111.62 has completed and larger fall from 114.54 is resuming. Intraday bias will be turned to the downside for 38.2% retracement of 104.62 to 114.54 at 110.75. As such decline is viewed as part of medium term correction, we’ll look for bottoming signal above 109.76 key support in that case. On the upside, above 112.88 will target 61.8% retracement of 114.54 to 111.62 at 113.42 instead.
In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.76 support holds. However, decisive break of 109.76 will dampen this bullish view and turns outlook mixed again.
