Intraday Trend Opportunity on USD/JPY? – Trade Closed

Trade Closed: 2011-09-13 06:00 ET

Hello forex friends! Here is the review on my USD/JPY short from yesterday. The pair did rally into the US session and the Fib area did hold as resistance, but there wasn’t much action from that point on. Check it!

Before you move on, for those who are not familiar with my framework, signals, setups, or acronyms, please visit my discretionary trading framework blog.

PCDPOD201109012.review.png

As we can see in the review chart above, I caught a bit of luck as the pair missed my stop out level by about 3 pips before reversing back lower and bringing me into a small profit. Heading into the European trading session, it looked like the pair wasn’t in for much movement, so I decided to close manually at the major psychological round level (77.00) for a very small profit.

Total: +10 pips/ +0.08% gain

In retrospect, I definitely could have been a bit more conservative with my entry, but given the overall risk sentiment, a quick turn back into the yen was a likelier scenario to me at the time. Overall, I still managed to gain a little bit of profit, and a profit is still better than a loss, right?

Anywhoo, I’m scoping out some Fib retracements on Cable and EUR/USD, so be sure to stay tuned on my Twitter and Facebook for potential setups. Good luck!

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Trade Idea: 2011-09-12 06:10 ET

Good morning forex fanactics! Spotted a potential intraday trade opportunity on USD/JPY as it trends lower. Will it continue into the start of the US trading session?

PCDPOD201109012.png

It’s the usual setup of selling into a downtrend on a retracement. Today, USD/JPY Is at Friday’s low of 77.10, which happens to fall in line with our usual Fibonacci retracement levels. If risk aversion continues from the European debt issues, then we could see the Yen strengthen across the board as traders get back in to the market this week. Without any major events for the upcoming US session, I expect technicals and the trend to continue.

I look to short at 77.10, with my stop being half of the daily average true range of 60 pips, and my target at the minor psychological level of 76.50; a potential return-on-risk of 2:1. Here’s what I will do:

Shorting USD/JPY at 77.10, stop at 77.40, pt at 76.50

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

Since this is a day trade, I will only risk 0.25% on this trade. As always, please stay tuned to adjustments by following me on Twitter and Facebook! Good luck and good trading!

  • Pip Fanatic

    Sorry, I meant NOT considering the spike.

  • Goron4x

    pipcrawler, i need your help, why is euro gaining strength since everybody says is going down…. all over the news??

    • pipcrawler

      Well,  given EUR/USD has lost about 1000 pips in the last two weeks, the known data may be fully priced in.  A 1000 pip move is huge, so my GUESS is that all the sellers have been exhausted and now we’re seeing a profit taking bounce.  Even though foreign exchange is the biggest market, there is a limit to the number of buyers and sellers out there.   

      • pipcrawler

        Also, there was an article just released stating that Italy is turning to China for aid to buy Italian bonds.  This could be providing support as well.  Check the article here: link to cnbc.com

  • Afzaalqadir

    it didnt worked to ur plan

  • Goron4x

    PATIENCE my dear , 77.40, NOT 77.37 , DISCIPLINE……, it is not ower YET !!!

    • pipcrawler

      Yup, looks like it’s holding for now… let’s see where the Asia session takes USD/JPY. 

  • Pip Fanatic

    I think I may have found a Gartley. I’m not sure if I’m right, it’s not perfect. Move AB reversed at the .618 retracement of move XA but move BC reversed at the .500 (I’m considering the shadow that touched the .618 a spike, don’t know if i’m right in doing so tough) retracement of move AB instead of .382 or .886. But still move CD reversed near the 1.272 extension of move BC and the .786 retracement of XA. Was it just a coincidence or the pattern doesn’t have to be perfect?