Last time we looked at the USD/JPY, I noted that it completed a double top and had downside risk towards 112. 112 was a key support area.USD/JPY Daily Chart 1/19(click to enlarge)Sharp Rebound- The US Dollar made a sharp reversal against most majors.- The USD/JPY slipped to 112.60 before sharply rebounding above 113 and just missing 115 by the start of the 1/19 US session.- The 1/18 session candle is the type that signals a bullish reversal.- Such a bullish candle sets up a pivot at 112.60. Basically, we can start considering USD/JPY bullish as long as price is above 112.60.Reward to Risk:- So, let's retreats and we set up a buy at 113.50.- If we put a stop at 112.40, we would risk 110 pips.- 116 is a viable target, even if the market is not ready for bullish continuation but instead spends more time in consolidation mode.- A slightly more aggressive target would be 118.00.- These targets which do not require a new high on the year yield reward to risk profiles of 2.6:1 and 4:1.