Technical outlook:
USDJPY pushed further through the 124.00 mark on Wednesday as projected. The currency pair might have carved a lower high below 125.00 as bears prepare to resume lower again. Potential remains for a test of 124.20-30 mark before terminating the corrective rally but prices would ideally stay below 125.00-10 mark going forward.
USDJPY had earlier dropped from 125.00 highs through 121.30 lows, carving meaningful downswing as seen on the 4H chart here. The subsequent rally through 124.00 seems to be corrective (three waves). Also note that it has reached up to the Fibonacci 0.618 retracement of above drop, which is seen close to 124.00 mark.
If the above structure holds well, prices would stay below 125.00-10 mark and reverse sharply lower from here. Potential remains for a drop through 116.00-35 zone, which is past resistance turned support zone. A further break below 114.60 will confirm that a meaningful top is in place around 125.10 levels and bears will remain in control going forward.
Trading plan:
Potential drop through 116.00 against 125.50
Good luck!
