USD/JPY was sold off sharply on Wednesday down to 120.40. This caused prices to drop below the daily Ichimoku cloud breaking the cloud base at 121.70. Prices found support at the 120.40 level and bounced back up into the 121 handle. This support level is a Fibonacci level. It is the 76.4% retracement of the upleg from 118.88 to 125.84. Next support comes at 118.88. To the upside the 61.8% Fibonacci is acting as resistance now at 121.53. We would need to see a break above 124.43 for upside momentum to be strong enough to target 125.84. Above this multiyear peak, the uptrend will resume.
In the bigger picture, the uptrend from 75.55 is still in progress and the market remains bullish above 110.00.
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