August 5, 2021
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
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