USD/JPY's rebound was limited by 78.28 resistance last week and subsequent sharp fall shifted favors back to the case that fall from 79.52 is in progress. Initial bias is mildly on the downside this week for 76.55 support. Break will confirm this bearish case and target a test on 75.56 low. on the upside, though, above 77.17 minor resistance will turn bias neutral and would likely bring more consolidative trading between 76.55/78.28.

In the bigger picture, there is no sign of long term trend reversal in USD/JPY yet even though downside momentum is diminishing with bullish convergence condition in weekly MACD. USD/JPY is still trading below the falling 55 weeks EMA. Not to mention that it's far below the falling 55 months EMA. Rebound from 75.56 low could extend higher and beyond 80 psychological level. But it could turn out to be a corrective three wave rally in the end. So, we'd at least prefer to see sustained break of 55 weeks EMA (now at 79.40) before considering the case of reversal. And break of 85.51 resistance will need to confirm. Otherwise, anything happens now will be viewed as corrective and an eventual break of 75.56 low to 70 psychological level is still favored.

In the long term picture, the long term down trend in USD/JPY is still in progress. Such down trend is expected to extend further into uncharted territory with 70 psychological level as next target. In any case, we'd at least need to see sustained break of 85.51 before considering trend reversal.