USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 96.88; (P) 97.85; (R1) 98.45; More.
USD/JPY's fall continues after brief recovery and dives to as low as 96.71 so far in early US session. At this point, intraday bias remains on the downside for 95.61 support next. As mentioned before, USD/JPY could be forming a head and shoulder top pattern (ls: 99.67, h: 101.43, rs: 99.71?). Break of 95.61 will now be an important signal that whole rise from 87.12 has completed and will turn short term outlook bearish. On the upside, above 97.82 minor resistance will turn intraday outlook neutral first.
In the bigger picture, the down trend from 124.13 (07 high) is still intact. This is supported by the fact that USD/JPY is still struggling to take out 55 weeks EMA (now at 99.93) decisively. Bearish divergence condition in daily MACD and RSI are also indicating loss of upside momentum and suggest possibility of reversal. Hence, while further rise to above 101.43 cannot be ruled out, we'd expect strong resistance as USD/JPY approaches medium term trend line resistance at 101.98 and bring reversal. Break of 95.61 support will be an important indication that whole rebound from 87.12 has completed and should bring resumption of the down trend from 124.13 eventually.