The USD/JPY pair rose during the Tuesday session to break the top of the hammer that the pair formed on Monday. The signal was bullish, and as a result more traders came into the market. The range wasn’t that large, but the fact that it was positive after such a strong move higher overall is pretty impressive. The trend in this pair is changing, and as a result we only want to be long. (In fact – we are, and are also looking to add.)
On a break of the 85 level above, we would see the 50% Fibonacci level giving way from the last major move down, and this would have us adding more to our positions. The selling of this pair isn’t a thought at this point, and until we get below the 80 handle – we will buy dips.
Written by FX Empire