USDJPY has remained a boring pair to trade since the end of August of 2015. Partially due to the lack of optimism in the Fed’s rate hike, this pair slumped and remained in a range ever since offering much unwanted volatility.
This recent breakout is tradable for both short term day traders and longer term trend traders. This upwards breakout with the testing of the ascending trend-line is a good indication that further upside can be expected.
My current expected target is at least the cross of the 123~ price level and even up to the point of 123.60. Anything above the 123.60 price level and we are pushing it against the origin of the 500+ pips selloff marketing a potential supply zone. Although I do not place too much emphasis on this area because of the number of overlapping candles, we use past prices and patterns as indications of levels where we can expect future price activity marking critical monitoring zones.
Current profit target is just shy of the 124~ price with a stop loss below both moving averages. I use these two moving averages commonly as dynamic support and resistance level. In this case, these two moving averages serve as a support and I would exit the trade once this level has been broken. You can also view it as re-entering the consolidation.