USD/JPY: Risk-reward favours shorts at current levels near 99.50
- Possible topping formation in EUR/JPY (see chart).
- AUD/JPY looks to be re-starting its downtrend and a break below 89.00 would confirm this (see chart).
- Pretty obvious resistance level now at 101.50 in USD/JPY.
As I’ve said many times recently, I think USD/JPY is likely to stop out a lot of people on both sides of the market. I still think the short-term market is overly long and we could get another nasty squeeze lower towards 92.50 before the bulls re-emerge. For the medium-term player, a 200 pip stop against a 700 pip profit target makes excellent sense and I’m happy to be short anywhere near 99.50/100.00.