Daily Pivots: (S1) 105.02; (P) 105.35; (R1) 105.54; More..
USD/JPY’s pull back from 105.67 extends lower today but outlook is unchanged. We’d expect down side to be contained above 104.39 resistance turned support to bring another rally. On the upside, break of 105.76 will resume the rebound from 102.58, for 38.2% retracement of 111.71 to 102.58 at 106.06. However, decisive break of 104.39 will indicate that the rebound has completed, and bring retest of 102.58 low.
In the bigger picture, USD/JPY is still staying in long term falling channel that started back in 118.65 (Dec. 2016), and there is no clear indication of trend reversal yet. Though, sustained trading above 55 week EMA (now at 105.90) will be the first sign of reversal and turn focus to channel resistance (now at 1110.31).
