Forex Chart Patterns: Yen Trend Continuation Trade. USD/JPY just dipped back to the 141.00 area!
Are we looking at a pullback from an uptrend?
Or a reversal in the making?
I don’t know if you’ve noticed, but USD/JPY has been making higher highs and higher lows since mid-July after the pair found support from the 138.00 psychological handle.
Forex Chart Patterns: Yen Trend Continuation Trade
The 142.00 area was an effective resistance though, and now the pair is back to consolidating at the 141.00 zone.
Are we seeing a short-term reversal or just a pullback from USD/JPY’s uptrend?
Technical indicators favor more buying as the 100 SMA sits just under USD/JPY’s current prices. Not only that, but USD bulls could also take advantage of the 38.2% Fib retracement and trend line support near the current prices.
Buying at current levels or at the first signs of bullish momentum would yield a good risk ratio especially if USD/JPY ends up making new weekly highs in the next trading sessions.
Don’t discount a downside breakout though!
Make sure you have a trading plan mapped out so you don’t miss out on either a bullish or bearish scenario!