Daily Pivots: (S1) 112.28; (P) 112.72; (R1) 113.09; More…
USD/JPY drops sharply today with a strong break of 112.02 support. The development now suggests that decline from 114.73 is resuming. Intraday bias is back on the downside for 110.83 first. Break will target 61.8% retracement of 107.31 to 114.73 at 110.14. We’d look for bottoming signal again below 110.14. On the upside, above 112.05 minor resistance will turn intraday bias neutral first.
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.
