Daily Pivots: (S1) 108.85; (P) 109.10; (R1) 109.38; More…
USD/JPY recovers to as high as 109.63 so far as it’s continuing to draw support from near term channel. Nonetheless, upside is limited below 110.02 short term top so far. Thus, intraday bias remains neutral and more consolidation would be seen. On the downside, below 108.64 will bring deeper pull back. But downside should be contained by 38.2% retracement of 104.62 to 110.02 at 107.95 to bring rebound. On the upside, break of 110.02 will resume the rise from 104.62 to 61.8% retracement of 114.73 to 104.62 at 110.86 next.
In the bigger picture, corrective decline from 118.65 (2016 high) has completed with three waves down to 104.62. Rise from 104.62 is possibly resuming the up trend from 98.97 (2016 low). This will be the preferred case as long as 55 day EMA (now at 107.95) holds. Decisive break of 114.73 resistance will confirm our view and target 118.65 and above. However, sustained break of 55 day EMA will dampen this bullish view and turn focus back to 104.62 low instead.
