The USD/JPY pair has broken down below critical support yesterday at 110.20 and is now trading around 109.70. There are signs of a bounce coming that should bring price back above 110.20 but I believe this will only be another selling opportunity.
The short-term oscillators are pointing higher for a bounce in prices. I expect price to reach 110.20 at least if not the cloud resistance at 110.50. I believe this bounce will be a shorting opportunity with 111.50 as stop. I expect price afterwards to resume the downtrend towards 108.20.
I believe USD/JPYis in its second leg down breaking below the weekly kijun-sen (yellow line indicator).The target remains at 108.20 for the minimum to be achieved. After reaching 108.20 I will be turning neutral or even bullish as the chances for a bounce back to 112 will have increased. For the time being though I remain bearish looking for bounces to be sold.
