USDJPY - Short Trading Idea on the 4h Chart.
Introduction:
After last December's US economic uncertainties (US-China trade wars and US government shutdown), JPY played its role as the world's safehaven currency and rallied back to its mid 2018's levels. Since January this year we've been witnessing an indecision as to whether it'll continue its move downwards or pullback to its previous 114.000 levels on the FX:USDJPY. Price was rejected at this 112.000 level and bounced up from 109.750. Even though this was nourished by both currencies' behaviour, it failed to create a higher low and thus confirmed the suspicions that we now face a ranging market, instead of a strong trending one. Price usually follows the path of least resistance, so a bounce from this same 112.000 level is expected, as it'd take strong news/big volume to break the resistance. And the support, for that matter. We trade what is usually more likely to occur, and with the best risk/rewards involved.
What we see in the charts is an upwards channel with a slight bearish wedge touch to it. Price has been struggling in this level for almost a week, and JPY holidays might cause it to stall further, but it's a good trading opportunity nevertheless. This lack of movement also caused the RSI to go low, which might suggest a shift in trend.
How to Proceed:
Our team has already opened a short position on this level, with 2 additional scaling orders until 112.2.
Take Profit:
Our take profit targets are 111.000 and 110.000. They can be dynamically changed, i.e., according to live price action, should circumstances change. The arrows and horizontal levels are great indicative, though.
Stop-loss (Invalidation of Analysis):
Our stop-losses here are 112.500.
Side-notes:
Please keep in mind that the markets have been reacting strongly to news these days, specially on smaller majors, such as the NZD and the AUD, which could create instability and affect FX:USDJPY by correlation and arbitrage moves. We are trading the whole forex system here, not only a pair. These positions should be watched closely.
Please leave your comments below to inspire us to continue our work and don't forget to follow us! Have a great trading session!
After last December's US economic uncertainties (US-China trade wars and US government shutdown), JPY played its role as the world's safehaven currency and rallied back to its mid 2018's levels. Since January this year we've been witnessing an indecision as to whether it'll continue its move downwards or pullback to its previous 114.000 levels on the FX:USDJPY. Price was rejected at this 112.000 level and bounced up from 109.750. Even though this was nourished by both currencies' behaviour, it failed to create a higher low and thus confirmed the suspicions that we now face a ranging market, instead of a strong trending one. Price usually follows the path of least resistance, so a bounce from this same 112.000 level is expected, as it'd take strong news/big volume to break the resistance. And the support, for that matter. We trade what is usually more likely to occur, and with the best risk/rewards involved.
What we see in the charts is an upwards channel with a slight bearish wedge touch to it. Price has been struggling in this level for almost a week, and JPY holidays might cause it to stall further, but it's a good trading opportunity nevertheless. This lack of movement also caused the RSI to go low, which might suggest a shift in trend.
How to Proceed:
Our team has already opened a short position on this level, with 2 additional scaling orders until 112.2.
Take Profit:
Our take profit targets are 111.000 and 110.000. They can be dynamically changed, i.e., according to live price action, should circumstances change. The arrows and horizontal levels are great indicative, though.
Stop-loss (Invalidation of Analysis):
Our stop-losses here are 112.500.
Side-notes:
Please keep in mind that the markets have been reacting strongly to news these days, specially on smaller majors, such as the NZD and the AUD, which could create instability and affect FX:USDJPY by correlation and arbitrage moves. We are trading the whole forex system here, not only a pair. These positions should be watched closely.
Please leave your comments below to inspire us to continue our work and don't forget to follow us! Have a great trading session!
تم فتح الصفقة:
Price is still respecting our trendlines, but it isn't moving still. We have our stop losses in place and will keep the positions open.
