No change from our last week's analysis. It seems USD/JPY is building a base here. Now, the key resistance can be lowered to 79.25 level. If the pair breaks above there, the bulls will likely have the upper hand. Of course, to confirm the trend change, a subsequent move above 79.65 and 80.60 will be required.
The downside appears limited now, and I expect a breakout on the upside soon. Only a decline below 77.40 will negate this picture, but even then I expect the 76.00 level will remain intact.
Strategy: Longs favored on break of 79.25 with 130 pts stop.