USD/JPY is drawing in attention considering the level it has reached in recent trade since the break of the 105 figure.
As per yesterday’s analysis, USD/JPY has run to the 105.40/50s target:
According to the market structure, there is resistance at this juncture which could give rise to a test of support in the lower end of the 105 area:
On the other hand, this could be the last dance for the bulls for some time.
Failures here will open the prospect of a continuation of the deterioration of the pair towards a 103.50 target:
However, while this may fit the US election’s hedge narrative, from a technical standpoint, there are upside arguments for the dollar long term:
For the meantime, however, there is room for a correction to that 61.8% Fib retracement which would give rise to some downside in USD/JPY.
A 5-wave analysis offers some give at this juncture to a test of 93.59 before 95.50 can be achieved in the DXY.