Daily Pivots: (S1) 112.16; (P) 112.41; (R1) 112.73; More..
USD/JPY drops to as low as 112.00 so far today and the break of 112.23 support indicates resumption of fall from 114.20. It’s likely now in the third leg of the corrective pattern from 114.54. Intraday bias is now on the downside for 111.37 support and below. But still, downside should be contained by 38.2% retracement of 104.62 to 114.54 at 110.75 to bring rebound. Larger rise from 104.62 is expected to resume later. On the upside, above 112.66 minor resistance will turn intraday bias neutral first.
In the bigger picture, corrective fall from 118.65 (2016 high) should have completed with three waves down to 104.62. Decisive break of 114.73 resistance will likely resume whole rally from 98.97 (2016 low) to 100% projection of 98.97 to 118.65 from 104.62 at 124.30, which is reasonably close to 125.85 (2015 high). This will stay as the preferred case as long as 109.76 support holds. However, decisive break of 109.76 will dampen this bullish view and turns outlook mixed again.
