USD/JPY snapped a four-week winning streak and seems to have gone into a consolidation phase around mid-113.00s on Monday. Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, expects the pair to hold above the 23.6% retracement at 113.38 to retest the 114.55 high.

USD/JPY targets 114.55, then 115.60

“USD/JPY failed to close above the 114.55 October 2018 high last week, and has now eased back to the 23.6% retracement at 113.38. Provided this holds the downside we should see recovery and a reattempt on the 114.55 high.”

“Failure at 113.38 will imply a deeper sell off to 112.56, the 38.2% retracement, and potentially the 111.66 July high.”

“Above 114.55/70, we have 115.60, the 61.8% retracement of the move down from 2015 and then the 117.06 the 1998-2021 resistance line.”