Daily Pivots: (S1) 112.01; (P) 112.44; (R1) 112.93; More..
USD/JPY recovered ahead of 111.94 minor support but it’s held below 112.88. Intraday bias remains neutral first. Outlook is unchanged that fall from 114.54 is part of medium term correction. Below 111.94 will likely extend such fall through 111.62 to 38.2% retracement of 104.62 to 114.54 at 110.75. In that case, we’ll look for bottoming signal above 109.76 key support. 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.
