I'll be scouring the charts for "actionable masterpieces". These will be signficant chart patterns or set-ups that I feel are not only tradeable, but also have a high probability of making big profits with little risk. Whenever I spot an "actionable masterpiece", I will post an annotated chart (my chart art) along with an explanation. My goal is to help you learn how to spot these low ocurring but highly profitable "actionable masterpieces" yourself.
Buy USD/JPY
There's a constant back-and-forth battle for this pair between the two camps. On the bearish side, continued fears over risk and credit conditions as well as the possibility of Big Ben cutting rates in the US. On the bullish side, crappy comments from Bank of Japan officials, such as Bank of Japan Governor Fukui who stated that growth was slowing, doesn't help the yen. There is even some renewed speculation that the central bank could also consider cutting interest rates. Hey other central banks are doing it, why not hop on the bandwagon.
With bad news coming from both the US and Japan side, I look for this pair to trade in a range in the short-term. I place support around the 109.00 handle and resistance around 110.00.
Lo and behold, look what we have here!! The pair is trading slightly below 109 right now. Depending on how you look at the chart, one can see either a symmetric triangle or bullish divergence.
I'm going to buy at the fresh market price of 108.80. My stop loss (SL) will be 108.45, below recent lows. My profit target (PT) will be 109.50.
Buy USD/JPY @ 108.80 | SL: 108.45 | PT: 109.50
