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: it will be a big week for the Pound, as we have Inflation data and Interest Rate Decision from Tuesday to Thursday.
Let’s look at the technicals: