The USDJPY has spent the past six days consolidating.
In fact, I could argue that the pair has been directionless following the selloff and ramp higher at the end of 2016.
You can see the indecision from the monthly time frame:
This is a chart I’ve commented on several times over the last few months.
And as I mentioned last Saturday, the eventual breakout will likely determine the future direction for USDJPY for months to come.
If you saw that video, you know about the twenty-year inverse head and shoulders pattern.
Will it play out?
Maybe, maybe not. But I’m willing to bet that there is a good chance it does.
In my opinion, it’s all indicative of these unprecedented market conditions, hence the reason for my longer-term analysis of late.
As for USDJPY, you can see how the pair is coiling not only on the monthly chart above but also on the daily time frame below.
Based on all this coiling, the next move from the USDJPY could be incredibly explosive.
It may take another week or even a month or two to breakout, but the resulting move should be well worth the wait.
As for me, I’ve been long USDJPY since 107.12, which I also shared with Daily Price Action members on April 15th.
So far, the indecision has been palpable, but I’m sticking with my plan.
In the short-term, it will probably take a close above the trend line from the April 6th high to expose higher levels.
As I mentioned on Saturday, one such resistance area is 109.30/50.
Alternatively, a close below 106.90 support would suggest weakness.