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The USD/JPY pair has seen a decisive rejection as expected the 200-day average at 105.57 and analysts at Credit Suisse see scope for a deeper setback to the near-term uptrend at 104.20.

Key quotes

“USD/JPY has retested and again rejected our first target of the 200-day average and November high at 105.59/75 and we remain of the view this barrier should remain intact initially, clearing the way for a deeper pullback/consolidation.”

“Below 105.33 has already seen a minor top complete to add weight to this view for a move below the ‘measured top objective’, 38.2% retracement of the January/February rally and price support at 104.93/83. This should see weakness extend back to 104.46/44, then the near-term uptrend at 104.20, with our bias then for a fresh floor here.” 

“Immediate resistance is seen at 104.95, with the immediate risk seen lower whilst below 105.33.” 

“A close above 105.57/77 remains needed to reassert the recovery for the “measured wedge objective” at 106.95/107.05.”