Daily Pivots: (S1) 108.78; (P) 109.33; (R1) 109.74; More…
USD/JPY drops to as low as 108.64 so far as the correction from 110.02 short term top extends. Intraday bias stays on the downside for near term channel support (now at 108.56) and below. But we’d expect strong support from 38.2% retracement of 104.62 to 110.02 at 107.95 to contain downside and bring rebound. Above 109.24 minor resistance will bias back to the upside for 110.02. Break of 110.02 will resume the rise from 104.62 to t 61.8% retracement of 114.73 to 104.62 at 110.86 next.
In the bigger picture, break of 108.12 support turned resistance now suggests that corrective fall from 118.65 (2016 high) has completed with three waves down to 104.62. And, rise from 98.97 (2016 low) could be resuming. Focus is back on 114.73 resistance and break there will pave the way to 118.65 and above. This will now be the preferred case as long as USD/JPY stays above 55 day EMA (now at 107.97).
