Remember the long-term range that we’re watching on USD/JPY? Well, I decided to close my position and regroup for another trading day.
As I mentioned in my tweet a couple of days back, I already closed my USD/JPY for a small profit. That was just after Janet Yellen’s speech failed to excite the dollar bulls. You see, even though she hinted that a rate hike could come sooner should Uncle Sam’s job prospects improve, some traders can’t get past the fact that the Fed is also less than optimistic about the country’s inflation outlook. As a result, USD/JPY barely moved after some initial spikes.
On a technical perspective I spotted a smaller range forming inside the long-term range that we were looking at. It seems like the pair just can’t get past the 101.75 area, which lines up with a mid-range resistance. Not only that, but Stochastic was also ready to leave the overbought territory. I closed my position at 101.68 for a mere 0.04% gain (almost at break even!). I see now that this was a pretty good decision considering that the pair is around 30 pips below my exit point.
Still, I shouldn’t feel too good about missing the bullet considering that I had two perfectly good opportunities to get better results. The first one is exiting when the pair was at the 102.25 area and Stochastic was back in the overbought zone. The second one is a possible scaling opportunity when the pair went back to the major 101.30 support. Simply put, I let too many of my unrealized profits go and missed a good opportunity to maximize my gains. Boo!
Fingers crossed for another good setup this week!