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USD/JPY has eroded the three-month downtrend and Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank expects the pair to continue its advance towards the 104.45 eight-month downtrend.

Key quotes

“USD/JPY’s recent low at 102.595 was not confirmed by the daily RSI, and the market has seen a decent rebound, which has eroded the three-month downtrend. We will allow for further strength to the eight-month downtrend at 104.45.” 

“Only a drop below the 102.45/25 would open the way for the April 2009 and July 2013 highs as well as the February and May 2014 lows at 101.54/100.75 to be reached. Further down the 2016 low can be spotted at 99.00.”