USD/JPY Forecast December 9, 2016, Technical Analysis

USD/JPY daily chart, December 09, 2016

The USD/JPY pair fell at the open on Thursday but found enough support just above the 112.50 level to turn things around and form a nice-looking hammer. Nonetheless, I am a bit reticent to start going long at this point because I have no interest in buying a market that is overbought. We need to either grind sideways and build up enough momentum to continue the move higher, or we need a pullback significantly in order to offer value. Until I see one of those 2 things happen I will be on the sidelines but certainly would not consider selling regardless what happens.