Strategy: Pending Long
Looking past choppy short-term trade, USDJPY monthly charts suggest a reversal may be starting to take shape. Prices are carving out a bullish Falling Wedge chart setup, with a Bullish Engulfing candlestick pattern bolstering the case for a reversal higher. Importantly, we’ve seen a similar setup appear in late 2010 and so will opt to remain on the sidelines until the pair conclusively breaks the wedge top, now at 78.44.
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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