UOB Group: the USD/JPY can test the 112.00 handle in the short term. While USD is still holding within the expected 112.50 - 114.20 consolidation range, the rapid pace of the decline over the past 24 hours was unexpected. At this stage, we view the current weakness as a ‘deep pull-back’ and not the start of a bearish reversal.
That said, the pullback has scope to extend lower towards 112.00. Only a clear break below this level would indicate that the start of a bearish phase. For now, the odds for such a move are not high but unless USD can reclaim 113.40 within these 1 to 2 days, the immediate downward pressure would increase quickly.