USD/JPY has surged higher to start the year. Economists at Credit Suisse maintain a core bullish outlook for a test of the long-term downtrend from April 1990 at 116.83. 

Support at 114.96 ideally holds

“A knee-jerk pullback should be allowed for following the strength yesterday but we expect the market to remain well supported ahead of a move to test 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 at the downtrend from April 1990 of 116.80/85, we look for a break higher post this for a challenge on the 118.61/66 highs of late 2016 and 2017.” 

“Big picture, with 10yr US Bond yields also expected to establish a major base we look for an eventual rise to 122.90/123.00.”

“Near-term support moves to 115.90/81, then 115.68 which we look to ideally hold. A close below 114.96 though is needed to ease the immediate upside bias.”