USDJPY seems to have carved yet another higher low around 105.80 levels yesterday. The currency remains in control of bulls as it traders above 106.20 mark for now. It should be looking to push through 107.50 resistance in the near term.
USDJPY had dropped through 101.18 lows on March 09, 2020. The drop was an impulse wave, which was followed by a rally towards 111.75 levels before finding resistance again. The currency had peaked at 111.75 on March 24, 2020.
Since then, it has remained in control of bears until prices dropped through 104.20 mark. The drop was in 3 waves, hence corrective. Also note that USDJPY found support just below the fibonacci 0.618 retracement of the rally between 101.18 and 111.75, seen around 105.20 levels.
Structurally the medium term wave counts could be potential Waves (1) and (2) in place around 111.75 and 104.20 levels respectively. If the above proposed counts are correct, USDJPY should ideally stay above 104.20 levels and push through 111.75 and higher in the next several weeks.
After printing lows around 104.20, USDJPY has been in a broad trading range, potential triangle structure. It could be into its last leg or has already terminated around 105.80 yesterday. Either way, the currency might be preparing to break above 107.00 handle soon.
Immediate resistance is seen towards 107.50, while support is at 104.20 respectively. A push through 107.50 would confirm that bulls are back in control and that a meaningful bottom is in place around 104.20 respectively.
Long against 104.20, targeting above 109.85