Technical outlook:

The USD/JPY Daily chart might be suggesting that the pair has room to correct lower. At this moment, it looks range bound since it is trading between 108.20 and 111.20 levels since long and that it needs to break either of them to confirm the further direction of the trend. The higher probability remains lower looking at other USD counterpart pairs topping out yesterday. But a sustained push above 111.20 levels would indicate further strength in the pair ahead. Looking into the wave counts, the USDJPY seems to have rallied into an impulse wave early between 104.60 and 111.20/30 labeled as 5 waves here. The subsequent drop might be into wave B as labeled above; and if this count holds true, then the next wave C should be pushing lower as shown here.

Trading plan:

Aggressive traders might go short now, with a stop above 111.30 levels target 107.50.

Fundamental outlook:

Watch out for German Unemployment Rate and Claims at 0355 AM EST followed by Euro-Zone Consumer Price Index at 0500 AM EST.

Good luck!