USDJPY, having surpassed our long-term target of 90.00, is now probing the 94.13/95.00 key retracement/chart resistance zone. Failure here would spark the beginning of a corrective phase for 88.06 minimally.
USDJPY rallied straight through our core target of 90.00 and is now up challenging the 94.13/95.00 long-term 38.2% Fibonacci retracement/chart resistance zone. We remain cautious up here on USDJPY and highlight that both weekly and daily momentum are at extremes. Subsequently a failure here and reversal through shortterm trend support at 92.70 would signal a top is in place, reinforced through 91.98. In this circumstance we would envisage the market reversing lower to 88.06 and potentially then to the 86.82/85.54 chart/pivot support cluster. For this exponential advance to persist higher the market needs to clear 95.00, which we feel is not plausible without the above correction lower first. However, in the event that this does occur, we would see scope for the market to target 99.86/101.45.
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