Now that I’m out of my EUR/USD position, I decided to go back to trading USD/JPY!
Like Pipcrawler, I’m still overall bullish on the dollar and bearish on the yen. However, I can’t deny that the Fed’s recent decision to continue tapering brought forth risk aversion (and yen strength) as they’re worried that it’s too early to lessen Uncle Sam’s stimulus.
This is why USD/JPY’s descending channel setup is looking good for me right now. More specifically, I’m looking at the 103.00 major psychological handle to serve as resistance since it has held in the past and it’s currently near the mid-channel resistance and 100 SMA on the 1-hour chart.
I’m planning to manually enter 0.50% of my account at 103.00, place a 100-pip stop (already above the channel and 200 SMA) and initially aim for 102.00 for at least a 1:1 trade. I’ll probably add if I get triggered and the trend is too strong in favor of the yen.
As always, I’ll be watching this one closely and enter manually in case today’s U.S. session reports support a dollar rally.