My next for pick for the day is the Australian dollar against the Japanese yen. This forex pair broke out from a 3-week double bottom formation the other day as seen in its 4-hour chart above but hasn’t continued its swing up. It actually went back down after finding some resistance at 89.59.

After a break to nearly 76.00 on Thursday, the USD JPY rallied overnight after the Group of Seven nations agreed to take steps to curb the Japanese currency’s rapid rise. The wave of coordinated intervention by the global financial powerhouse also known as the G-7 is an attempt to stabilize the Yen and bring it back to more respectable levels following the post-earthquake rally.

Although some traders feel the Japanese Yen may be overextended to the upside, the currency is trading slightly better ahead of the start of the U.S. session. At this time there seems to be a tug of war developing between traders and investors.

After hitting a low of 81.08 last February 4, the USDJPY pair has rallied back to mark a high of 83.97 2 days after Valentine’s day. It appears, however, that US dollar’s push against the Japanese yen is starting to lose some momentum. As you can see from its 4-hour chart above, the pair has formed what looks to be a head and shoulders pattern with a neckline at around 83.10.