Technical outlook:
USDJPY has produced an impressive rally in the past 12 weeks since printing lows at 102.59 on January 06, 2021. Bulls have managed to register fresh highs at 110.96 today, remaining shy from the 111.00 handle by a few pips. Also note that a major resistance around 109.85 levels has been successfully taken out. The trend remains intact but we can see a pullback 107.00/108.00 levels before the rally could resume.
USDJPY is off the day's highs and is seen to be trading around 110.65 levels at this point in writing and this could be the beginning of a corrective decline in the coming sessions. Immediate resistance now stays at 111.79; while support comes in around 108.30/40 zone going forward. The fibonacci 0.382 retracement of rally between 102.59 and 110.96 is seen towards 107.80 mark and a drop towards those levels also remain possible.
The uptrend since March 2020 lows registered at 101.18 also remains intact and bulls are poised to push higher towards 112.00/113,.00 levels in the next few trading sessions. Structurally, a meaningful resistance has been taken out at 109.85 as shown on the chart here; hence probability for a temporary pullback remains high from here.
Trading plan:
Aggressive traders remain short with stop@ 111.75, target @ 108.40
Good luck!
