USD/JPY rally should struggle at the accelerated downtrend – Commerzbank

Karen Jones, analyst at Commerzbank, suggests that they would allow for some near term consolidation to feature for the USD/JPY pair as the market attempts to absorb recent sharp swings, after it has rallied to and is so far holding around the 108.90 accelerated downtrend.

Key Quotes

“The recent move lower was exhaustive and we are seeing a near term correction higher as the market attempts to absorb the massive move. It briefly spiked through the 104.56 2018 low, but did not register a close below here and we suspect it will attempt to recover. 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.”