The USD/JPY pair had a back and forth session on Thursday, essentially going nowhere for the second day in a row. This is a huge surprise though, we have seen a fairly significant move higher, and most of the time that we get these breakdowns from ascending triangles, it's only a matter time before we pullback in trying to reestablish the breakout level as being support.
I don't think the real collect rent way, and certainly pullbacks will be bought in this pair. Certainly, you can't short this pair based upon the Bank of Japan and pretty much everybody in the world being long, but in the end I believe that a pullback of some sort is probably coming. This will simply be a buying opportunity, and we will look back at it and realize and we should have added to already long positions.
Multiyear trend
The longer this goes on, the more I am convinced that the Yen weakness will be a multi-year trend. It's not only in this pair, it's quite frankly in anything against the Yen in general. This includes the Euro most certainly, as it has been strong, as well as other currencies around the world. This also includes gold, which is getting absolutely slaughtered against most other currencies.
Looking at this chart, I believe that measuring the ascending triangle for a target has a need for the 104 level, an area that I think we will see in relatively short order. Obviously, as I said before I will be selling this pair, and I can't quite frankly for the life of me figure out who would be doing so. However, it should be stated that my broker has listed on its website that more than half of retail traders are short of this pair still. This is even after the debt obvious breakout of the 100 level. Don't be that guy.
Going forward, I believe that every time this pair dips it is a buying opportunity, and it would not surprise me to see a 110 print sometime later this year.
