Repost: USD/JPY Coiling For A Bullish Breakout? (

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On the surface, the USD/JPY’s long-term weekly chart looks bearish. After all, it has been putting in lower lows and lower highs since it peaked out in June 2015.

More recently, it made a high just below 114.50 in July this year, which led to a sizeable move down to 107.50 long-term support. But here, the USD/JPY formed a false break reversal pattern, which triggered the latest rally. This rally has now stalled.

Ahead of the Japanese general election, due to take place on October 22, the yen has been firming up, finding additional support from geopolitical uncertainty. Meanwhile the US dollar has simultaneously been hit by weakness in US employment data and ahead of CPI this Friday. But is the USD/JPY coiling for a big bullish breakout, anyway?

Many speculators would probably look at last week’s doji candle as a sign that the long-term downtrend has resumed. And to be fair, they could very well be correct. But, with the recent trend of USD/JPY being bullish and after the formation of that false break reversal at 107.50 key support, not to mentioned the break above 21-week moving average or the short-term bearish trend line, I think the USD/JPY is poised for a potential bullish breakout rather than a breakdown.

Specifically, I will be looking for new signs that the sellers are … more on

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