12 May 2016, USD/JPY
USD/JPY is currently trading with a slight bullish bias. Yesterday, the pair traded short and even broke below the support zone 108.65-108.58. We expect the current upward rally to be a mere retracement and should not go beyond 10.65, thus, expect a possible rebound from the above zone to go continue short with our target at 108.37. A clear breakout above this zone will invalidate the anticipated downward rally and may lead to an acceleration towards 109.34. This pair should be traded alongside GBP/JPY, GBP/CHF, EUR/JPY and USD/CHF These pairs have a strong positive correlation of up to +0.89 and will have a similar price action during this intraday.
As long as the pair trades below the zone 109.65-108.58, look for short positions with your ultimate target at 107.37. Buy positions are only recommended above 108.65 with a target at 109.34.