USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 111.02; (P) 111.34; (R1) 111.56; More…

USD/JPY is still limited below 111.82 resistance and intraday bias stays neutral first. While the consolidative pattern from 111.82 might extend with another fall, downside should be contained by 38.2% retracement of 104.62 to 113.17 at 109.90 to bring rebound. On the upside, break 111.82 will indicate that rise from 109.76 is resuming. And intraday bias will be turned back to the upside for retesting 113.17 high. Decisive break there will resume larger rally from 104.62.

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 109.36 support holds. However, decisive break of 109.36 will mix up the outlook again. And deeper fall should be seen back to 61.8% retracement of 104.62 to 113.17 at 107.88 and below.