USD/JPY has the 123.00 in its crosshairs – Credit Suisse

USD/JPY is taking a healthy breather. Economists at Credit Suisse view this as a healthy pause ahead of a test of the long-term downtrend from April 1990 at 116.83.

Support at 114.96 ideally now holds

“With 10yr US Bond yields now seen completing a major base as looked for we expect this to further reinforce the existing base in USD/JPY.” 

“We look for a break above 116.35 for a test of the long-term downtrend from April 1990, now seen at 116.83. Whilst we would expect to see a fresh phase of consolidation to emerge here, we look for a break higher post this for a challenge on the 118.61/66 highs of late 2016 and 2017.” 

“Big picture, we look for an eventual rise to 1222.90/123.00.” 

“Near-term support moves to 115.62, then 115.68/62 which we look to ideally hold. A close below 114.96 though remains needed to ease the immediate upside bias.”