Daily Pivots: (S1) 111.98; (P) 112.36; (R1) 112.63; More..
USD/JPY’s break of 111.94 minor support suggests that recovery from 111.62 has completed at 112.88 already. Intraday bias is back on the downside for 111.62. Break will resume the decline from 114.54 to 38.2% retracement of 104.62 to 114.54 at 110.75. As the fall from 114.54 is viewed as part of medium term correction, we’ll look for bottoming signal above 109.76 key support. On the upside, break of 112.88 will delay the bearish case and extend the rebound from 111.62 instead.
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.
