USD/JPY extends its consolidation from 127.53/27, but analysts at Credit Suisse look for only a temporary floor.

Short-term momentum rising sharply

“USD/JPY has rebounded from our first target of the ‘neckline’ to the multi-year base and 50% retracement of the 2020/2022 uptrend at 127.53/27 and with short-term momentum rising sharply, we expect slightly further short-term strength up to 136.67/95, which we would then expect to cap.” 

“Post this recovery, we expect a sustained break below 127.27 and then the 126.36 May 2022 low in due course, which should see weakness extend to the 61.8% retracement at 121.44 later on in the year.”