USD/JPY’s strong rally last week suggests that consolidation from 157.88 has completed and rise from 139.87 is resuming. Initial bias stays on the upside this week. Decisive break of 158.85 key structural resistance will be a strong medium term bullish sign, and bring retest of 161.94 high. For now, outlook will stay bullish as long as 154.38 support holds, in case of retreat.
In the bigger picture, corrective pattern from 161.94 (2024 high) could have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. Decisive break of 158.85 structural resistance will solidify this bullish case and target 161.94 for confirmation. On the downside, break of 150.90 resistance turned support will dampen this bullish view and extend the corrective range pattern with another falling leg.
In the long term picture, up trend from 75.56 (2011 low) is still in progress and might be ready to resumption. Firm break of 161.94 will target 61.8% projection of 102.58 (2020 low) to 161.94 (2024 high) from 139.87 at 176.55 in the medium term.
