Today’s pick will be on the EURJPY again, but this time a little trickier. I drew a fib line on the 4hr chart and as you can see we have a couple of resistance points lining up; most notably the 61.8% fib and the S1 line.
In the morning we have the E-12 PPI and ECB interest rate statement. Now I am looking to go long at 137.88, but if the PPI is a big surprise or if Trichet is soft on his stance on the short term outlook on interest rates I will take my long trade off and go short with a break and candle close below the S1 and fib line. Going for 10 pips either way with a 30 pips stop. My aggressive target would be the pivot point in the long direction or the S2 line in a short play. I know initially, it’s a bad risk to reward ratio, but I think it’s a high probability trade in either scenario.