Kyle, while I agree whole-heartedly with your excellent technical analysis, I have a strange feeling that we may see a vicious spike higher in USD/JPY first. If EUR/CHF can rally 500 pips in a night, then anything is possible. If the SNB can intervene to weaken their currency, then why not the BoJ as well? We all know that the Japanese need the Yen to weaken and re-energize their struggling export market. Maybe the BoJ will try a similar tack to the SNB. If they do, EUR/JPY will see our 134 target in double-quick time and USD/JPY will be at 100+.
I am square on all JPY crosses at the moment, and happily so. As I wrote earlier, I am a dip buyer in EUR/JPY, much preferring the long side of that cross. But in USD/JPY, the overall trend is down, so leave a flyer at 101 to sell USD/JPY and I’m sure you will be able to pick them back up 200 pips lower in very quick time.
