Daily analysis of USD/JPY for January 19, 2016 Market Analysis Review

Overview

As the minor resistance at 118.37 is intact, further fall could still be seen. But price actions from 125.85 are still viewed as a sideways consolidation pattern. Thus, we expect the strong support from 116.13 to bring a rebound. Breaches above the mark of 118.37 will turn bias back to the upside for the 120.33 support that turned into resistance. Nevertheless, a sustained break of 116.13 will indicates that it is a deeper medium-term correction. At this point, we are viewing it as a sideways pattern and expect the strong support around 116.13 to contain the downside. However, a sustained break of 116.13 will indicate that the corrective fall from 125.85 would extend to the 38.2% retracement of 75.56 (low of 2011) to 125.85 at 106.63 and lower.

Daily Pivots: (S1) 116.88; (P) 117.16; (R1) 117.59

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