USD/JPY Forecast December 19, 2011, Technical Analysis

USD/JPY fell on Friday as traders sold off the Dollar in general. The pair did bounce towards the end of the session though, and the resulting candle for the session was a hammer. The lows are getting higher, so this pair looks like it wants to rise over time, but the 78.50 area above is massively resistive. The pair may be seeing the results of yearend short covering at this point, and no rallies will be overly impressive until the 80 level gets broken, which we have as a massive resistance area. In the mean time, we are waiting for rallies that show weakness to sell.