Bank of America Global Research discusses USD/JPY technical outlook and flags a double top pattern for a move towards 125-121.

"A peak in USDJPY has been made with a double top formation. The top is of tactical size with potential to evolve into something bigger given overbought conditions on longer term charts are now starting to correct," BofA notes.

"First support area is about 126-125.21. Notable Fibonacci retracements include 123.05 (50%) and 121.10 (61.8%). The cloud lines are rising quickly, are difficult to estimate where they could be tested as support and should be watched this month," BofA adds.