USD/JPY plunged due to DXY's sell-off and not because we have a strong Japanese Yen. On the contrary, the JP225 has reached a fresh new high signaling JPY's weakness. Still, the Nikkei (JP225) has shown some exhaustion signs, so a potential drop could make the Yen stronger.
The pair ignored the Unemployment Claims better than expected data. The indicator was reported at 310K far below 343K expected and versus 345K in the previous reporting period. The United States PPI and the Core PPI could be decisive tomorrow, worse than expected data may force the pair to drop.
USD/JPY Bearish Pressure
USD/JPY registered only a false breakout with great separation through 110.41 level showing strong sellers. It has escaped from the ascending pitchfork's body signaling that the upside is limited.
It has reached the triangle's downside line, the support. A valid breakout from this formation followed by a drop below 109.48 support could activate a larger downside movement.
Trading Conclusion
The USD/JPY has printed a potential Double Top. This pattern will be validated after a drop below the 109.40 level.
The material has been provided by InstaForex Company - www.instaforex.com