The USD/JPY has not been able to take much advantage of the recent rally in equites as much as the aud/jpy, gbp/jpy, and cad/jpy. Now it is forming a potential head and shoulders pattern. The pattern will not be validated until the uptrend line, which makes up the neckline of this pattern, is violated with a significant close below that line. While my bias is bullish for the USD/JPY and I expect a bounce off of this uptrending support line, it is something to be aware of. If you take a look at the weekly chart, this uptrending support line makes up the bottom of an ascending channel. I think that if we get a bounce it should the pair back to the top of the channel. In addition, I find that that Head and shoulders patterns with diagonal necklines are often not as dependable as head and shoulders patterns with horizontal necklines. Often, in these instances the pair begins to trend sideways in a ranging market.