Trade Closed: 2009-07-29 09:12

Good morning! It looks like I was able to catch a bit of profit during the Asia and European trading session on EURJPY.

The pair was able to make its way higher to my short entry orders at 134.00 and the pair found enough sellers during the Asia trading session to push EURJPY down to my first profit target at 133.00. I closed half of my position there and adjusted my stop to break even.

Unfortunately, the 133.00 seems to be the main support area for the day and the pair quickly found itself back up to 134.00 and stopping my remaining position out at break even.

1st Half: +100 pips
2nd Half: +00 pips
Total: +0.50% gain

The pair is back below 134.00 at the moment, but I don't expect much more movement for the rest of the US trading session. Maybe a trend lower due to risk aversion, especially after US durable goods came in weaker than expected and after China equities took a hit during the Asia trading session.

That's it for now. Thanks for checking out my blog, stay tuned for new ideas, and be sure to check out Forexgump's thoughts on upcoming US Advance GDP!

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EURJPY finally broke out to the downside today! While I was unable to catch the initial break, I think the current retracement may be an opportunity to jump back into a possible move lower.

I've posted up another one hour chart, and I thought I'd point out the the pair made a rising wedge pattern. This is usually a bearish signal, which played out as the market broke below the rising trendline. Now that the move is confirmed, I feel more confident to short EURJPY once again, especially after a retracing up to the 38% Fibonacci levels drawn on the chart. Will the sell area hold as resistance?

My fundamental views remain the same as my last post as remain bearish on the economy until we see not just a bottom, but a new trend towards growth in jobs and rising housing prices.

I will wait until volatility takes us back up around the 38% Fibonacci retracement line. My stop will be above the 61% Fibonacci retracement level and I will target strong support around 132.00. Here's what I am going to do:

Short EURJPY at 134.00, stop at 135.00, pt1 at 133.00, pt2 at 132.00

Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.

There's still plenty of economic data left for the rest of the week to bring one some volatility to risk sentiment. The ones to watch are German CPI, UK mortgage and consumer data, and US Durable Goods Orders. Be safe and stay tuned!