Karen Jones, analyst at Commerzbank, suggests that USD/JPY is seeing a minor rebound from the 50% retracement at 106.47, but has been slightly deeper than they hoped.

Key Quotes

“Currently we suspect that the market will struggle to make gains but with no additional sell signal is relatively neutral very near term. Failure at 106.47 will target 106.00 then 105.32/78.6% retracement, which is the last defence for the 104.46 August low.”

“The recent rejection from the 50% retracement at 108.43 (of the move down from April) and the mid September high at 108.48 is viewed as an interim top.”

“The market stays offered below the 200 day ma at 109.07. The 200 day ma guards the 55 and 200 week moving averages at 109.91/110.24.”