Daily Pivots: (S1) 107.68; (P) 107.81; (R1) 108.06; More…
USD/JPY rebounds strongly today but stays below 108.80 resistance. Intraday bias remains neutral first. Considering bullish convergence condition in 4 hour MACD, firm break of 108.80 will confirm short term bottoming at 106.78. In this case, stronger rise should be seen back to 110.67 resistance. On the other hand, rejection by 108.80, followed by break of 107.56 will retain near term bearishness. Intraday bias will be turned back to the downside for 106.78 support instead.
In the bigger picture, decline from 118.65 (Dec 2016) is still in progress, with the pair staying inside long term falling channel. Break of 104.62 will target 100% projection of 118.65 to 104.62 from 114.54 at 100.51. For now, we’d expect strong support above 98.97 (2016 low) to contain downside to bring rebound. In any case, break of 112.40 is needed to the first serious sign of medium term bullishness. Otherwise, further decline will remain in favor in case of rebound.
