20 May 2016, USD/JPY
Wave Analysis
USD/JPY is currently trading with a bullish bias. Earlier today, the pair broke above the descending channel, and is currently heading to the upper side. Following this breakout, we wait for minor downward pullbacks towards 109.95 to give us low risk buy opportunities. This view remains valid as long as the pair trades above 109.95, a clear breakout below 109.95 will lead to an acceleration to the lower side but should not go below 108.47. This pair should be traded alongside GBP/JPY, AUD/JPY, and EU/JPY. These pairs have a strong positive correlation of up to +0.92 and will move in a similar direction during this intraday.
Trade Recommendations:
If you are not long already, wait for minor downward retracements towards 109.95, then go long with your target at the resistance level 111.03. A clear breakout above this target will call for further long positions. Sell positions are only recommended below 109.95 or upon a clear rebound from 111.03.
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