The USD/JPY has reached higher than the resistance level of 84.00 and is trading at 84.31 with about 2 hours left before the London open. The next area to watch is 84.80 which was the November low in 2009. Will we see the pair perform a correction at this level? If we clear 85.00 we could see 86.50 pretty quickly with 88-89.00 being the biggest hurdle for the bulls as the pair spent many weeks in 2009 & 2010 using this area as a springboard before finally dropping below it and staying below since June 2010. We all know that the Japanese Government is hell bent on devaluing their currency, but will they be able to weaken it enough to keep the Bulls going, and if so how far will they go? The Weekly RSI is in Overbought Territory, so if we do get a correction soon, look for support at 83.85 & 83.18 as well as 82.25. There is a high probability that we will see a correction soon, but we could also see another 'Santa Run' on this pair before the year is up.
Happy Trading!