daily chart

USDJPY: 88.14

Short-Term Trend: uptrend

Outlook:

USD/JPY is moving higher even faster than expected. As you know I turned bullish on weekly chart back in March of 2012. Then on daily chart I turned bullish when the pair moved above 79.65 level. And I expected this market to really start moving up after it broke above the key 83.80 resistance level. And sure it did. Now, the daily uptren is very strong but the market is also heavily overbought. While in storng uptrend overbought conditions do not matter a lot, so we can continue to favor the long side. But my guess is that if the prices return below 86.70 level, a short-term correction will start. So, it makes sense to protect the longs with a stop at 86.70 level....

Strategy: Holding long from 81.30 is favored. Stop=86.70