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So far so good for my GBP/USD setup! If you’re not into the pound though, then you might want to take a look at USD/JPY’s next potential forex uptrend.

After yesterday’s strong intraday uptrend, USD/JPY is seeing a possible retracement around the 120.40-120.50 area. This coincides with a strong previous resistance as well as Fib retracement levels on the 1-hour time frame. Of course, it also doesn’t hurt that the 100 SMA has just crossed above the 200 SMA and it looks like Stochastic is about to hit the oversold territory.

USD/JPY 1-Hour Forex Chart
USD/JPY 1-Hour Forex Chart

Fundamentally I think there’s definitely room for more gains for the pair. A 2015 rate hike for the Fed isn’t completely off the table yet and yesterday’s better-than-expected initial jobless claims and housing reports only boosted confidence for the dollar bulls.

An entry around the Fib levels with a stop just below the rising trend line and the SMAs could get us sweet pips if we aim for the pair’s 2015 highs. We could also enter partial positions and build a trade setup around those Fib levels and 120.00 support areas.

What do you think? Is USD/JPY about to see more gains?

XOXO,

Huck

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