The USD/JPY pair is declining against the background of the carry trade transactions in Asia. From the technical point of view, with the level breakthrough of 120.31 opening short positions in the pair should be considered.
[URL deleted]Trade Idea Update: USD/JPY - Stand aside
The greenback dropped sharply again today and briefly penetrated 116.00 level, however, lack of follow through selling and the subsequent quick rebound to 116.97 suggest consolidation would be seen and test of the Kijun-Sen (now at 117.04) cannot be ruled out, however, reckon the lower Kumo (now at 117.26) would limit upside and price should falter below the upper Kumo (now at 117.57), bring another decline later.
On the downside, below intra-day support at 115.97 would signal recent decline is still in progress and may extend weakness to 115.90-93 (61.8% projection of 120.66-116.69 measuring from 118.38), then towards 115.70, however, near term oversold condition should prevent sharp fall below 115.50, bring rebound later. In view of this, would be prudent to stand aside in the meantime.
* Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 118.03.
* Put the stop loss 1 pip below the local swing low.
* Move the stop loss to break even once the trade is 20 pips in profit.
* Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
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