USD/JPY prepares for an attack on 2008 high

USD/JPY continues to gain ground, and for now it does not seem to be noticing the resistance at 109 formed by the weekly R2 and 2008 Sep high. The next obstacle, which should be more difficult to overcome, is the 2008 high at 110.70. Accordingly, there will be a high chance of a downward correction before the Dollar finally surpasses it. The dip may extend down to 106 and will still not invalidate the bullish outlook, as the up-trend will remain intact.

There are significantly more bears in the market at the moment than there are bulls—the former take up 70% of the total amount of traders and see the recent surge as an upward deviation from the true value of the Greenback.