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Karen Jones, analyst at Commerzbank, points out that USD/JPY has eroded the 110.00 resistance level and remains within the confines of a short term channel, the top of which is located at 110.77.

Key Quotes

“The Elliott wave count continues to indicate that this move is corrective only. We are currently sitting below the 200 day ma and the October low at 111.28/41. We remain suspicious of the current rally and will attempt short positions. The base of the channel at 108.90 guards the 107.75/50 band.”

“Resistance at 111.38/41, the 26th October low, guards112.23 the 6 th December low and the top of the range at 113.84.”