Daily Pivots: (S1) 112.10; (P) 112.31; (R1) 112.49; More…
USD/JPY’s fall from 113.43 short term top extends in early US session and intraday bias remains on the downside. Deeper decline would be seen to 55 day EMA (now at 111.35) first. On the upside, above 112.57 minor resistance will turn intraday bias neutral first. But risk will stays on the downside as long as 113.43 resistance holds.
In the bigger picture, rise from 98.97 (2016 low) is seen as the second leg of the corrective pattern from 125.85 (2015 high). It’s unclear whether this this second leg has completed at 118.65 or not. But medium term outlook will be mildly bearish as long as 114.49 resistance holds. And, there is prospect of breaking 98.97 ahead. Meanwhile, break of 114.49 will bring retest of 125.85 high. But even in that case, we don’t expect a break there on first attempt.
