USDJPY has dropped through 108.75 levels and bounced off sharply higher by over 100 pips. The corrective drop since 111.60 highs seem to be complete now and bulls might be back in control to push prices higher close to 111.00/20 levels in the near term.
Looking at the larger degree wave structure, USDJPY bulls have carved an impulse wave higher towards 111.60/70 levels or they might have terminated Wave (3). Either ways, they remain poised to push prices higher from here at least towards 112.50 levels.
USDJPY seems to be into its last phase within its (A)-(B)-(C) corrective rally that had begun since 101.18 lows in March 2020. Wave (A) had terminated around 111.75, while corrective Wave (B) dropped and terminated around 102.59 lows in January 2021.
Since then, Wave (C) has been unfolding and could be into it last phase higher towards 112.50 at least. Yesterday’s low around 108.75 was also in line with expectation and remained just shy of the fibonacci 0.382 retracement as seen on the chart here.
If the above structure unfolds accordingly, USDJPY bulls will be back in control from here and push prices through 112.50 and 113.50 levels respectively. Traders might prepare themselves to initiate fresh long positions.
Finacademy Technical Team
Gold prices dropped through $1773 lows on Thursday before finding support again. The drop from $1793 was in-line with price action of a gartley.
The US dollar index might have carved a lower high around 96.50 mark on Tuesday. The index dropped through 95.80 levels on Wednesday before finding some support.
USDJPY is soon approaching a formidable resistance zone around the 114.40-50 mark. The currency pair has been carving a corrective rally since 112.50 lows.