The pair may grow.

On the daily chart, the third wave of the higher level 3 of (1) develops, within which the first wave of the lower level i of 3 formed, and a correction developed as the second wave ii of 3. Now, the third wave iii of 3 is developing, within which the first wave of the lower level (i) of iii has formed, the correction (ii) of iii has ended, and the wave (iii) of iii is ending. If the assumption is correct, after the end of the local correction (iv) of iii the pair will grow to the levels of 116.00–118.00. In this scenario, critical stop loss level is 112.65.

Against the background of the negative dynamics of JPY, the quotes of USD/JPY are growing, trading around the level of 114.35.

USD is showing active growth in pairing with JPY in trading in Asia, recovering from the correctional decline the day before. USD showed a downtrend yesterday, caused by the publication of the US inflation report. 

USD/JPY renewed highs since 2019, breaking through 111.50 and 111.95, and stopped below the resistance at 113.56. Such a rapid growth of the instrument is associated with the strengthening of USD against the background of statistics on the US labor market released last Friday, as well as with the negative state of affairs in the Japanese economy after the lifting of anti-COVID restrictions.

This week, the USD/JPY pair resumed its growth and reached 111.77.