USD/JPY fell sharply last week but recovered after briefly breaching 156.36 support. ActionForex keeps its initial bias neutral for the week, with a break of 156.36 on the downside and a move above 159.02 targeting 160.38 on the upside.
USD/JPY fell sharply last week but recovered after briefly breaching support at 156.36. ActionForex says the initial bias remains neutral at the start of this week.
A firm break of 156.36 would argue that the rebound from 152.87 has completed, after the pair failed to sustain above the 55 D EMA. A deeper fall should then take the pair back to the 152.87 low. On the upside, a move above 159.02 will target 160.38.
Medium-term view: correction from 163.97
In the bigger picture, ActionForex reads the price action from the 163.97 medium-term top as correcting the rise from 139.87. The first leg could have completed at 152.87, ahead of 152.25 structure support.
A sustained break above the 55 D EMA, now at 158.09, would pave the way back to retest the 163.97 high. Nevertheless, strong resistance should be seen there to cap the upside, and there would likely be another falling leg before the pattern completes.
Long-term trend stays bullish above 139.87
The long-term outlook stays bullish as long as 139.87 support holds, even in case of a deep pullback. The up trend from the 2011 low of 75.56 is still in favor to resume once the current correction from 163.97 completes.
Source: ActionForex
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