USD/JPY edged higher to 108.08 last week but retreated since then. Initial bias remains neutral this week first. We’re still favoring the case that corrective fall from 111.71 has already completed at 105.98. Further rise should be seen and break of 108.08 will turn bias to the upside for 109.38 resistance. However, break of 106.74 support will dampen out bullish view and turn bias to the downside for 105.98 instead.
In the bigger picture, at this point, whole decline from 118.65 (Dec 2016) continues to display a corrective look, with well channeling. There is no clear sign of completion yet. Break of 101.18 will target 98.97 (2016 low). Meanwhile, sustained break of 112.22 should confirm completion of the decline and turn outlook bullish for 118.65 and above.
In the long term picture, the rise from 75.56 (2011 low) long term bottom to 125.85 (2015 high) is viewed as an impulsive move, no change in this view. Price actions from 125.85 are seen as a corrective move which could still extend. In case of deeper fall, downside should be contained by 61.8% retracement of 75.56 to 125.85 at 94.77. Up trend from 75.56 is expected to resume at a later stage for above 135.20/147.68 resistance zone.