USD/JPY to test 106.80 on a loss of the small base at 107.20 – Credit Suisse

USD/JPY remains under pressure, trading around the 107.30 region, but only below 107.20/16 would see the small base negated with next support seen at 106.80, analysts at Credit Suisse report.

Key quotes

“The pressure stays seen to the downside and below 107.16 would see the base neutralised to reinforce the broader sideways range with support seen next at 107.05, then 106.80/79. Removal of here can see a retest of the lows from May and June at 106.08/105.98. Beneath here would now see the completion of an important top.”

“Resistance is seen at 107.34/41 initially then 107.60, with a break above 107.78/80 needed to ease the pressure off the base ‘neckline’ to reassert an upward bias for strength back to 108.17/24, then the 200-day average at 108.38/43.”