The USD/JPY Rally Still Continues

USD/JPY broke out above the resistance trend line in a very convincing manner, with two bullish bars. The first is a clear pin bar, the second could also be interpreted as one (the body is quite large compared to the wick), but it also is very telling of the strength of the bulls for the moment, not to mention that it opened and closed the daily session above the daily time frame it broke out above.

I have deliberately marked the possible movement of the correction from the previous assessment, because that way I could compare how deep it reached to where I thought it would go. As you can see, the correction was much more shallow than my assessment, which is another sign of the bulls’ strength.

In my opinion, the first serious resistance will be in the zone around 115.00 – 115.50.

I think that to the downside the pair could test the trend line it broke out above, but if that happens it will be a good opportunity to look for entries to open new long positions.