Daily Pivots: (S1) 109.85; (P) 110.44; (R1) 110.82; More…
USD/JPY’s rise from 107.31 resumed after brief retreat. The development argues that fall from 114.49 is already completed at 107.31. Intraday bias is back on the upside for retesting 114.49 resistance first. Break will also confirm completion of correction from 118.65. On the downside, below 109.54 minor support will turn bias back to the downside for 107.31 instead.
In the bigger picture, rise from 98.97 (2016 low) is now seen as the second leg of the corrective pattern from 125.85 (2015 high). It’s unclear whether this this second leg has completed at 118.65 or not. But medium term outlook will be mildly bearish as long as 114.49 resistance holds. And, there is prospect of breaking 98.97 ahead. Meanwhile, break of 114.49 will bring retest of 125.85 high. But even in that case, we don’t expect a break there on first attempt.
