USDJPY bulls are now looking poised to push through 112.00/50 mark, after have carved yet another higher low around 107.50. Please note it bounced off the trend line support since January 2021 lows as well. Looking higher from here for next few weeks.
USDJPY structure remains bullish since printing lows at 102.59 on January 06, 2021. The currency has carved larger degree Waves (1), (2), (3) and now potential Wave (4) around 104.39, 103.33, 111.00 and 107.50 levels respectively.
Also note that Wave (3) was an extension, clearly sub dividing into 5 waves as labelled on the chart. Furthermore, USDJPY has bounced off the fibonacci 0.382 retracement of Wave (3), which is a general guideline for Wave (4) termination.
If the above larger degree structure holds well, USDJPY would stay above 107.50 and continue to remain in control of bulls. We can expect higher highs and higher lows, going forward. A minimum requirement for the wave structure to complete is a push above 111.75.
Looking at the short term wave structure, USDJPY seems to have completed a lower degree impulse rally between 107.50 and 109.70 levels respectively. If correct, we can expect a drop towards 108.40 levels from here, before the rally resumes.
Traders might be willing to buy more on a drop towards 108.40/50 with a minimum target towards 112.00 target towards 112.00 levels.
Finacademy Technical Team
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