The USD/JPY opened with a gap up and reached fresh new highs today. Was strongly bullish as the Yen was punished by the Nikkei’s impressive jump, the index opened with a gap up as well and touched new highs.
The JP225 continues the upside movement, technically should approach and reach new highs if will stay above the morning gap. A Nikkei’s minor drop will be confirmed only if the index will drop and will close today’s gap up.
Personally, I still believe that the Nikkei will decrease a little to correct after the amazing rally, the USD/JPY has already lost altitude after the morning bullish momentum. The USD was expected to increase versus its rivals as the after the last days’ very good US data, the USDX climbed above the 93.81 horizontal resistance, but remains to see if will have enough energy to make a valid breakout.
The USD/JPY edged higher and jumped above the 23.6% retracement level, but failed to stay there and now could retest the median line (ml) of the minor ascending pitchfork. A valid breakout above the median line (ml) will signal a further increase on the Daily chart . The bullish movement was expected after the failure to reach and retest the 38.2% retracement level, but only a valid breakout from the extended sideways pattern will confirm a larger increase, while a false breakout above the median line (ml) will send the rate tumbling.
