FX.co ★ Technical analysis of USD/JPY for April 29, 2016

Technical outlook and chart setups:

The USD/JPY weekly chart is presented here to view a larger picture. Please note that the rally from 75.00 through 125.00 levels unfolded into 5 waves. The drop after that is expected to find support at 106.60/70 levels, which is the Fibonacci 0.382 support (of the entire rally from 75.00 levels). A bullish bounce from 106.70 levels would confirm that the first wave (with in 3 wave drop) is completed. A corrective rally should then unfold towards 115.00/117.00 levels before dropping lower again. It is hence recommended to remain flat for now and wait for a bullish reversal to initiate long positions. Immediate support is seen at 106.70 levels, while resistance is seen through 112.05 levels respectively.

Trading recommendations:

Remain flat for now, looking to go long again on a bullish bounce.

Good luck!