Daily Pivots: (S1) 111.92; (P) 112.24; (R1) 112.70; More..
USD/JPY’s rebound from 111.37 extends today but stays below 112.88 resistance. Intraday bias remains neutral first. Another fall cannot be ruled out yet. On the downside, break of 111.37 will extend the fall from 114.54 to 38.2% retracement of 104.62 to 114.54 at 110.75. As such fall is seen as part of medium term correction, we’ll look for bottoming signal above 109.76 key support. On the upside, break of 112.88 resistance will suggest that the fall has completed and turn bias back to the upside for retesting 114.54.
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.
