Daily Pivots: (S1) 108.29; (P) 108.46; (R1) 108.66; More..
USD/JPY’s fall to 107.65 invalidates our bullish view and intraday bias is turned neutral first. At this point, we’re still seeing price actions from 109.72 as consolidation pattern. Downside should be contained by 38.2% retracement of 104.45 to 109.72 at 107.70. On the upside, break of 108.86 minor resistance will turn bias to the upside for retesting 109.72 high. However, sustained break of 107.70 will pave the way to 106.48 cluster support (61.8% retracement at 106.46).
In the bigger picture, USD/JPY is staying in long term falling channel that started at 118.65 (Dec. 2016). Recovery from 104.45 also failed to sustain above 55 week EMA (now at 109.02). Overall outlook remains bearish and fall from 118.65 is in favor to extend through 104.45 low. This will now stay as the favored case as long as 109.72 resistance holds.