USD/JPY Daily Outlook
Daily Pivots: (S1) 106.93; (P) 107.54; (R1) 107.88; More.
USD/JPY's fall from 108.59 extends further to as low as 105.94 today. Break of 106.71 support indicates such decline has resumed. As discussed before, corrective rise from 104.96 has completed with three waves up to 108.59, just missing 100% projection of 104.96 to 107.89 from 105.68 at 108.61. Further decline is now expected to retest 104.96 low and break will confirm whole down trend from 124.13 has resumed. Meanwhile, above 106.79 minor resistance will turn intraday outlook consolidative first.
In the bigger picture, fall from 114.77 should still be in progress as long as 110.10 resistance holds. Though, with a short term low in place at 104.96, firm break of this support is needed to confirm the down trend resumed. Otherwise, some more consolidation could still be seen in short term. Also, whole medium term down trend from 124.13 remains in force towards key medium term support zone of 101.22/65 level. However, since the structure of the fall from 124.13 is not clearly impulsive yet, the fall from 124.13 might only be part of a wide range consolidation pattern only and 101.22/65 key support might hold. Much attention will be paid there on sign of reversal as USD/JPY approaches this key support zone.
On the upside, though, above 110.10 will indicate that fall from 114.77 has already completed. Stronger rally could the be seen retest the trend line resistance (now at 112.36). But still, a decisive break of trend line resistance is needed to be the first signal that whole down trend fro 124.13 has completed. Otherwise, medium term outlook will remain bearish.
Don
