USD/JPY’s uptrend continued last week as hit 131.24. As a temporary top was formed, the initial bias is neutral this week for consolidation. Outlook will remain bullish as long as 126.91 support holds. A break of 131.24 will resume the uptrend to 261.8% projection of 109.11 to 116.34 from 114.40 at 133.26. However, considering the bearish divergence condition in 4-hour MACD, a break of 126.91 will confirm short-term topping and turn bias back to the downside for a correction.
In the bigger picture, the current rally is seen as part of the long-term uptrend from 75.56 (2011 low). Sustained trading above 61.8% projection of 75.56 (2011 low) to 125.85 (2015 high) from 98.97 at 130.04 will pave the way to 100% projection at 149.26, which is close to 147.68 (1998 high). For now, this will remain the favored case as long as 121.27 support holds.