About Pick of the Day

Each day, I will try to find what I believe is the best looking short term trade setup for the upcoming trading day or week. If you're a forex newbie, it can be tricky in the beginning trying to figure out how to look at charts and draw lines. My goal is help you understand the psychology of price movements so you can learn to analyze your own charts and trade on your very own. I will post my ideas and/or reviews through out each session right here, on Twitter and on Facebook.

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Pick of the Day: EUR/JPY

Posted 17:03 25 January 2006 | Comments

Check out this chart on the EURJPY:

The EURJPY has been trending upwards since it bounced off the 200 SMA on the daily chart. Here on the one hour chart we are going to take advantage of a retracement and continue the ride on up! With fib retracements I usually like to set my entry orders at the 38% level and my stops at the 61%. So, a long entry at 141.39 seems enough with an initial target of 10 pips. For a more aggressive target I like to go for the previous high/low, so go for 142.02 if you're feeling it's going to move. Place stop at 141.01 level. Now, if you want to be extra cautious you can enter when the pair hits the 50 SMA. The last time the pair hit the pink line it bounce right back on up!