USD/JPY scope for a test of 114.74 – Commerzbank

In opinion of Karen Jones, Head of FICC Technical Analysis at Commerzbank, recent price action in USD/JPY could allow for a re-test of the 114.70 area.

Key Quotes

“The market has tested the bottom of the range towards 11.59 and recovered – we can only assume that we are about to test the 55 day ma at 114.74. We view the recent low at 111.59 as an interim low. Between 111.59/114.83 the market is side lined. A close above the 115.62 19th January high is needed to reintroduce scope to the key short term resistance offered by the 16 month resistance line at 117.86”.

“Only below 111.59 would introduce scope to Fibonacci support at 109.92 and, if seen, the 200 day ma at 107.73. We look for this to hold (this is also the 50% retracement of the move up from November). However this is not our favoured view - we also note that the recent move lower continues to indicate that this is the end of the corrective move”.