Last weekend I posted a Trade Plan where I stated that we shouldn’t get carried away with the yen pairs strength because a reversal of this magnitude (remember that the yen pairs had been falling for 2 straight months) wouldn’t come overnight.
I also stated that I was expecting a double bottom as a confirmation to start looking at reasons to buy these pairs.
So, this week provided exactly what was predicted and we now have more confidence to begin to think about a reversal on the pairs.
Warning: this will be a busy week for the Aussie and Kiwi as we will have the RBA Minutes (Tuesday), Australia Unemployment (Thursday) and RBNZ Interest Rate Decision (Wednesday). With this much news, caution is advised on those days.
Let’s look at the technicals: