December 20, 2013 – USD/JPY (daily chart) has continued its sharp advance after having broken out last week above May’s 103.72 long-term high and establishing a new 5-year high in the process. The past two months alone have seen a hefty 8% climb thus far from its consolidation area near 97.00 support in late October. This substantial climb broke out above a large triangle consolidation pattern, then went on to reach and surpass its upside targets at 100.00, 103.00, and then the noted 103.72 previous high.
Having done so, the pair has confirmed a continuation of the sharp bullish trend that has been in place since the September 2012 low near 77.00, and is now closely on target to hit its next upside objective at 105.00. Going into the end of 2013 and the beginning of 2014, the outlook for USD/JPY remains significantly bullish. Although a corrective pullback should soon be due, a move above 105.00 should begin to target a key upside resistance objective around 108.00. Strong downside support on any substantial pullback within the current uptrend resides around the 101.50 price level.
James Chen, CMT
Chief Technical Strategist
City Index Group
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