USD/JPY’s extended rebound last week argues that fall from 137.90 has completed at 129.62. Rise from there is seen as the third leg of the corrective pattern from 127.20. Initial bias is mildly on the upside and sustained break of 55 day EMA (now at 133.43) will target 137.90 resistance. On the downside, though, break of 129.62 will bring retest of 127.20 low.
In the bigger picture, corrective pattern from 127.20 might be extending. But after all, down trend from 151.93 is expected to resume at a later stage. Break of 127.20 will resume this down trend and target 61.8% projection of 151.93 to 127.20 from 137.90 at 122.61. This will now be the favored case as long as 137.90 resistance holds.
In the long term picture, price action from 151.93 is seen as developing into a corrective pattern to up trend from 75.56 (2011 low). While deeper decline cannot be ruled out, downside should be contained by 38.2% retracement of 75.56 to 151.93 at 122.75.
 will target 137.90 resistance. On the downside, though, break of 129.62 will bring retest of 127.20 low.){kind=link}