USD/JPY jumped to a high of 114.59 on Thursday as March Fed rate hike probability neared certainty following hawkish comments from the Fed officials.
It is no surprise to us as we believe Fed is a silent cheerleader of Trump’s policies.
If we take a look at the daily chart, the action over the last two months looks like a mini version of the setup seen during May 2016- Nov 2016 period.
Source: Netstatio – http://www.netdania.com
- The breach of the descending trend line and a rounding bottom formation is almost similar to the breach of the descending trend line and a rounding bottom period seen in 2016.
- A daily close above 115.00 would mark a bullish break from the rounding bottom… similar to the one seen on November 9.
- That would open doors for a rally to 118.66 (Dec high) – 120.00 levels.
- Only a daily close below 111.58 (Feb 7 low) would signal bullish invalidation.