17 May 2016, USD/JPY
USD/JPY is currently trading with a strong bullish bias. During the previous week, the pair formed a triple top at 109.34, headed short but could not close clearly below 108.47. We are waiting for a clear breakout above the current triangular formation to go long, or a clear rebound from 109.34 to go short. However, as long as the level 109.34 protects the upper side, we expect an acceleration to the lower side but should not go below 107.80. This pair should be traded alongside USD/CHF, USD/CAD, GBP/JPY and HKD/JPY. These pairs have a strong positive correlation of up to +0.92 and will likely have a similar price action during this intraday.
Remain flat for now and wait for a clear breakout above the resistance level 109.34 to go long with your target at 109.84. A clear rebound from this resistance line will call for short positions with your targets at 108.47 and 107.80.
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