Orders Cancelled: 2012-01-31 01:15
…my orders never triggered!
During this time, the yen was simply beastin’ across the boards, and it just so happened that the euro was beginning to show signs of weakness as well. Yesterday saw the pair’s biggest decline. Apparently, the markets didn’t like the fact that Greece still hasn’t reached an agreement with its creditors and that no major resolutions were made at the EU summit.
Though I believe EUR/JPY may present more shorting opportunities down the line, I think it’s time to close my orders for this trade. Price is simply too far from my desired entry point at the moment. But I’ll be keeping my eye on this pair over the coming days, that’s for sure!
Thanks for following, fellas!
Trade Idea: 2012-01-26 02:22
Even though I got burned the past two weeks shorting the euro, I still think we’re about to see EUR/JPY take a drop soon. This time, I zoomed out a bit and made use of multiple time frame analysis to help me make a decision!
As you can see, EUR/JPY is fast approaching the trend line. Stochastic is also in overbought territory and huge bearish divergence has formed, which could signal a continuation of the long-term downtrend.
Now, let’s zoom in a bit and check out what’s happening on the 4-hour chart:
Using the fabulous Fibonacci tool, I see that price is also approaching the 61.8% Fibonacci level, which just happens to lineup closely with the long-term falling trend line!
Fundamentally, I’m still in the short euro camp, at least for the medium term. Private bondholders and the Greek government have yet to come an agreement, and with the next proposal scheduled to be submitted sometime around February 13, I think the tension could weigh heavily on the euro’s prospects over the next couple of weeks.
In addition, I think part of EUR/JPY’s recent gains can be attributed to dollar and yen weakness. If you take a look at some of the other cross pairs, like EUR/GBP and EUR/AUD, the euro hasn’t been able to dominate like he’s a Manning brother.
Here’s my game plan:
I’m looking to short just below the Fib level, at around 102.30. This also served as a resistance point in the past, so I expect some selling pressure there. I’ve put my stop at ½ the weekly ATR (260 pips), which should give my trade enough room to breathe.
For my profit target, I’ll be aiming for the previous low, around 99.00. In the past, I probably would have set my target at around 97.00, but I think it would be better to have a more conservative approach, given how wildly EUR/JPY has been trading.
Who’s willing to join me on this trade? Let me know what you think by hitting up the comments below!