The ongoing surge in USD/JPY strength has extended above the resistance from the top of the "triangle" at 119.14/25.
"We favour the completion of a "triangle” continuation pattern to see the core trend turn bullish again for strength to 120.83 initially, ahead of a retest of 121.86," CS projects.
"Above the latter can signal a resumption of the medium-term bull trend for the 2007 peak at 124.16, potentially 125.70. Near-term support is placed at 118.01, with 116.64 needing to hold to keep the risk bullish," CS adds.
Same for GBP/JPY, where CS notes that is has not only seen a small base complete above 180.28, but also a bullish "reversal week".
"We look for this to provide the platform for a test of the 61.8% retracement resistance at 184.30/55. Through this latter area is needed to clear the way for a retest of the December 2014 peak at 189.72. With medium-term downtrend resistance not far above at 189.92, we would expect a fresh cap here.," CS projects.
"Support shows at 179.60/30 initially, with 177.62 needing to hold to suggest the immediate risk can stay higher," CS adds.
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