Sentiment extremes over the last month have failed to usher the pullback we proposed and again this week’s wedge in USDJPY led to another strong rally. Our two longer-term upside targets are the Fibonacci extension at 91.42 and the Head & Shoulders projection at 93.01. Near-term, the rally from 86.77 has unfolded in 5 waves again but the reversal so far is forming a bearish shooting star candle; a close near or below the open of 88.78 will cement a reversal. Any pullback is expected to find support at old resistance of 88.43 and then 88.34/00 where the previous small triangle correction formed. A break of overnight highs at 89.35 can signal a new wave higher. Levels: Support – 88.43, 88.34, 88.00 Resistance – 89.10, 89.35, 91.42.
Nomura