USD/JPY: Spike lower is exhaustive - Commerzbank

Karen Jones, analyst at Commerzbank, suggests that the USD/JPY’s major sell off seen on the 3rd January was exhaustive and we are seeing some near term consolidation/correction higher as the market attempts to absorb the massive move.

Key Quotes

“It has spiked through the 104.56 2018 low, but did not register a close below here and we suspect it will attempt to recover. It has halted at 104.10. Initial resistance is the 109.44 accelerated downtrend. While near term rallies are contained by the 111.38 26th October low, it will remain offered. Support at 104.63/10 guards 100.70 Fibonacci support and the 99.00 2016 low.”

“Resistance at 111.38, the 26th October low, guards112.23 the 6 th December low and the top of the range at 113.84.”