USD/JPY Weekly Outlook

USD/JPY Weekly Outlook

USD/JPY's correction from 96.70 extended lower last week and as long as 95.02 minor resistance intact, deeper fall could be seen to 61.8% retracement of 90.85 to 96.70 at 93.08 and below before completion. Meanwhile, above 95.02 will flip bias back to the upside for retesting 96.70 high. At this point, we'd still expect recent rally to resume later to 100 key resistance level next.

In the bigger picture, whole decline from 124.13 should have already completed at 75.56. Stronger medium term rally could be seen back towards 101.65 key support turned resistance level. We'll see how USD/JPY responds at around 100 to judge the underlying medium term momentum for stronger up trend. Meanwhile, break of 90.85 support is needed to be the first sign of medium term topping. Otherwise, we'll stay bullish.

In the long term picture, down trend from 124.13 has completed at 75.56 already. Rise from 75.56 is starting to look impulsive which suggests the start of a long term up trend. We'll stay bullish as long as 84.17 resistance turned support holds and will pay close attention to how USD/JPY reacts on hitting 100 psychological level.