Daily Pivots: (S1) 104.88; (P) 105.80; (R1) 106.35; More…
USD/JPY drops to as low as 104.45 so far today and break of 105.04 support indicates down trend resumption. Intraday bias is back on the downside for 100% projection of 112.40 to 106.78 from 109.31 at 103.69 next. In any case, break of 106.73 resistance is needed to confirm short term bottoming. Otherwise, outlook will remain bearish in case of recovery.
In the bigger picture, decline from 118.65 (Dec 2016) is still in progress and the pair is staying well inside long term falling channel. Firm 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.
