USD/JPY
Strategy: Pending Short
USDJPY sold off after putting in a Dark Cloud Cover bearish reversal candlestick formation at the top of a falling channel that has been guiding the pair lower since April 2009 to pause ahead of the 90.21 – 90.57 congestion region. Price are now working though the last layers of support in this area, with a daily close below it opening the door for a major decline toward a new swing low at the channel’s lower boundary (now at 84.50). We will opt to err on the side of caution and wait for this confirmation before entering short, but the bearish scenario certainly looks compelling.
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