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USDJPY – turning south ?

My bullish view (see previous ) on USDJPY turned to a very efficient trade. Pair advanced relentlessly on a positive geopolitics and few other macro development – but we are not much concerned about macro, don’t we? Chart has everything we need for a good trade… Friday looked like profit taking before weekend.

Now,  I believe it is a time to quit our longs and start building up short pisitions. Our weekly patterns are still bearish and we are approaching strong resistance levels.

USDJPYWeekly

USDJPY Weekly

So, if this is a turning point for a pair, let’s see what our sell signals. Again, it all depends on our working time-frame and money management. If you are like me and prefer short-term impulse trades, then enter on break-out of 108.95 – last week’s minimum or place limit sell at 109.25.  One can also enter with market order on opening early tonight  (Asian session). These levels also good for scaled entry – splitting the total order size  in 50/50 or other combinations.

More cautious and generally long-term traders will place sell limit orders around 110.25-110.50 area – which is strong support areea on a Daily chart.

USDJPYDaily

USDJPY Daily

Below 4-hour chart will help us to determine shorter-term dynamic. Strong supports are at 108.07 and 106. 98 – those will become bounce levels, so  long-term sellers compelled to take some profit from the table there, while short-term buyers (including me) will use them for easy “quicky trades”.

USDJPYH4

USDJPY H4 

Summarizing – I expect next weeks bearish move  for USDJPY – which is also indirectly indicates at risk-off sentiment and possibly sell-off at equities and bullish action for gold. Please, however, use your discretion and never forget that trading is a game of probabilities. There is no certainty on markets and therefore, prudent risk management and trade quit strategies are mandatory in this game. In other words – use stops and size your exposure wisely.

Happy trades !