The USD/JPY pair rallied during the session on Tuesday, but as you can see a back most of the gains in order to form a perfect shooting star. With this perfect shooting star, I suspect that this market will pull back a little bit, but at the end of the day we should see a significant amount of buying pressure underneath. It is because of this that I look at this market as one that will more than likely offer a nice buying opportunity soon.
All I need to see is some type a supportive candle between here and the uptrend line that I have on the chart in order to start buying. I recognize that the 102 level offers a possible support level, and most certainly the 101.50 region does as well. Because of this, I have three potential support areas between those two levels and the uptrend line just below, and as a result I am most certainly bullish of this market still.
Several stops along the way.
I believe that there will be several stops along the way, but ultimately we should end up at the 105 level. It might take a while, because I see the shooting star as resistance, the 103 level as resistance, and the 104 level is resistance before we even get there. In other words, expect a lot of choppiness but I still believe that we have enough bullish pressure underneath to continue going higher, albeit long-term.
Selling is going to be almost impossible, simply because of the support levels and the fact that the Bank of Japan is working so hard to devalue the Yen. I cannot believe that the Bank of Japan is going to let the Yen continue to gain in strength for too much longer, and as a result they will eventually get their desire, a cheaper currency to help boost exports in what is one of the most export sensitive economies in the world. Going forward, I think that every time this pair dips, it will offer a buying opportunity.