The other week I wrote a post in which I laid out some reasoning for why I believed we’d be seeing some consolidation in the markets. Specifically, I looked at USDJPY, saying:
“Every time USDJPY has dipped below the 50-hour SMA since the election results, we’ve seen some extended consolidation. I’ve marked these three instances with blue rectangular boxes.
The first one lasted about four days, the second was a full seven days, and the last was just two days. We’re now trading below the 50-hour SMA once again, and I wouldn’t be surprised to see another period of consolidation.”
That post was nine days ago, and with Christmas behind us we’re starting to see at least some movement. Here’s what I’m observing in USDJPY now and why I’ve been selling the pair. (more…)