USD/JPY (daily chart), as of February 13, 2013, has pulled back slightly and consolidated just off its 33-month high of 94.44 established on Monday. For the past five months since the low just above 77.00 in September 2012, USD/JPY has shown very little in the way of bearish retracement or correction within the exceptionally steep bullish trend. This trend has signified unprecedented yen weakening against the dollar, representing a full 22% increase in price for USD/JPY over just a few short months. In most recent months, price has reliably reached its upside price objectives in a rapid manner, including 84.00, 88.00, 90.00, and 92.00.
Despite the current consolidation, overall bullish momentum remains strong for the pair. After being broken to the upside over a week ago, the 92.00 level has held strong as a key support level within the current uptrend. In the event of a further pullback, the 90.00 level should serve as further key support to the downside. With a continuation of the strong bullish trend, the next major resistance objective to the upside resides around 95.00, with further upside potential towards the 98.00 and 100.00 levels.
James Chen, CMT
Chief Technical Strategist
City Index Group
Forex trading involves a substantial risk of loss and is not suitable for all investors. This information is being provided only for general market commentary and does not constitute investment trading advice. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any financial instrument and should not be used as the basis for any investment decision.
