Daily Pivots: (S1) 108.15; (P) 108.51; (R1) 108.77; More..
With 4 hour MACD crossed above signal line, intraday bias in USD/JPY is turned neutral first. We’re favoring the case that rebound from 104.45 has completed at 109.48, after failing to sustain above 109.31 structural resistance. On the downside, break of 107.88 will affirm this bearish case and target 106.48 next. On the upside, firm break of 109.48 is now needed to confirm rally resumption. Otherwise, risk will stay on the downside in case of recovery.
In the bigger picture, strong support was seen from 104.62 again. Yet, there is no confirmation of medium term reversal. Corrective decline from 118.65 (Dec. 2016) could still extend lower. But in that case, we’d expect strong support above 98.97 (2016 low) to contain downside to bring rebound. Meanwhile, on the upside, break of 112.40 key resistance will be a strong sign of start of medium term up trend.
