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Dollar/yen is trading around 109, leaning lower but maintains a safe distance from the critical 108.10 level. What’s next? The team at Credit Suisse sees downside pressure.

Here is their view, courtesy of eFXnews:

Credit Suisse FX Technical Strategy Research argues that  USD/JPY bounces from current levels looks temporary, with resistance at 110.85/111.05 now ideally capping to keep the risks directly lower to test the low of the year at 108.13.

Below here would establish a large “triangle” continuation pattern to confirm the start of a more significant bear trend for 107.50  initially, then the 61.8% retracement of the June/December 2016 rally at 106.52, ahead of the potential uptrend from September 2012 at 105.20, where we would expect buying. Resistance moves to 110.36/44, ahead of 110.85/111.05.

…Resistance moves to 110.36/44, ahead of 110.85/111.05. Above here would complete a base to turn the risk higher for 112.20 next,” CS adds.

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