USD/JPY’s up trend resumed last week and hit as high as 116.34. But a temporary top was formed ahead of 61.8% projection of 109.11 to 115.51 from 112.52 at 116.47. Initial bias remains neutral this week for some consolidations. Downside should be contained well above 114.26 resistance turned support to bring rally resumption. On the upside, firm break of 116.47 will pave the way to 100% projection at 118.90, which is close to 118.65 long term resistance.
In the bigger picture, no change in the view that rise from 102.58 is the third leg of the up trend from 101.18 (2020 low). Such rally should target a test on 118.65 (2016 high). Sustained break there will pave the way to 120.85 (2015 high) and raise the chance of long term up trend resumption. For now, this will remain the favored case as long as 112.52 support holds, in case of deep pull back.
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 pattern 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.
