USD/JPY starts the week under serious downside pressure, with the market breaking below key support at 108.33, the key lows from March and “neckline'' support. A close below here, which looks very likely, would see a top complete to mark an important turn lower, as reported by the Credit Suisse analyst team.
A close below 108.33 would complete a top
A close below 108.33 would see a top complete to mark a more important turn lower. We would then see support next at the 38.2% retracement of the Q1 rally and 55-day average at 107.82/77, which we would look to hold at first. This though would be seen as a temporary hold ahead of a move to the uptrend from January at 107.49 next. We would note though the ‘measured top objective’ would be seen a lot lower at 106.05.
Resistance moves to 108.84 initially, then 108.97, with a break above 109.10 needed to ease the immediate downside bias for 109.57, then 109.76/78. Above 109.95/97 though remains needed to see a fresh low established.