USD/JPY Daily Forecast

Daily Pivots: (S1) 94.55; (P) 95.77; (R1) 96.53; .

USD/JPY's fall from 97.25 extends further to as low as 94.53 today so far and intraday bias remains on the downside as long as 95.47 minor resistance holds. Further fall should be seen to 93.84 support first and break will confirm resumption of decline from 101.43 towards 61.8% retracement of 87.12 to 101.43 at 92.58 next. On the upside, above 95.47 will turn intraday outlook neutral and bring consolidation. But short term outlook is still bearish as long as 97.25 resistance holds.

In the bigger picture, the failure to break through neckline support turned resistance reaffirmed the head and shoulder top case. That is, rise from 87.12, which is treated as a correction in the down trend from 124.13, has completed with bearish divergence condition in daily MACD and RSI, with a head and shoulder top pattern (ls: 99.67, h: 101.43, rs: 99.71). Break of 93.84 will bring fall resumption to 61.8% retracement of 87.12 to 101.43 at 92.58 next and then 87.12 low. Medium term outlook in USD/JPY remains bearish as USD/JPY is still limited well below trend line resistance (124.13 to 101.65) as well as 55 weeks EMA. Break of 87.12 will confirm down trend resumption for next key support level at 79.75 (95 low).

On the other hand, note that 100% projection 101.43 to 95.61 from 99.71 at 93.89 was just met and fall from 101.43 to 93.84 might indeed be corrective in nature. Above 97.25 will re-open the case that price actions from 99.67 is developing into triangle consolidation instead. Such development will in turn indicate that rise from 87.12 is still in progress and will put the long term down trend is serious threat.

Based on ActionForex.com Technical Outlook