USD/JPY Daily Outlook

Daily Pivots: (S1) 112.25; (P) 112.42; (R1) 112.68; More…

USD/JPY formed a temporary low at 112.05, ahead of 112.02 support and recovered. As the pair is staying in range of 112.02/113.74, intraday bias remains neutral first. Also, near term outlook stays bullish as long as 112.02 support holds and further rise is expected. Break of 113.74 will resume the rebound from 110.83 and target 114.73 key resistance. Decisive break there will carry larger bullish implications. However, break of 112.02 will likely extend the corrective pattern from 114.73 with another leg through 110.83 support.

In the bigger picture, we’re holding on to the view that correction from 118.65 is completed at 107.31. And medium term rise from 98.97 (2016 low) is going to resume soon. Sustained break of 114.73 should affirm our view and send USD/JPY through 118.65. However, break of 107.31 will dampen this view and extend the medium term fall back to 98.97 low.

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