From a technical standpoint this pattern can be considered a bearish crab but not a perfect one. Specifically the B point is not a precise 61.8 retracement. From a fundamental standpoint there is a "risk on" attitude with eur(french elections) and aud(CPI - Friday) and so the JPY is being sold. Can you infer or confirm my assumptions?
Japan has been in a channel since the end of 2016, after the break of a wedge formation on the 12/03/17 coupled with a SAR swap and a fall outside the Keltner further bearish movement has been expected. This was tested on the 11/04/17 as the Nikkei convincingly closed outside of the channel. Today we have had confirmation of that break out.
10 year yields. 2.30% level has been very supportive. Breakout of the wedge will mean uptrend will continue. Fundamentally this is supported by higher term premia being demanded, and Chinese flight capital leaving the UST market. I'm long USD and will add to my positions if 10 year yields really start to move a lot higher.
As we could see if retest the green box support area 111-111.3, USDJPY very likely to reverse to its previous high 115.7 and 116.8. Find support at 112.5 level and potentially it could bounce back right after hit that support to test previous high resistance. REMAIN BULLISH ON USDJPY!! Wait to take long position at the support.