About Pick of the Day

Pick of the Day Author

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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February 2008

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Pick of the Day: USD/JPY - Close Trade

Close trade: 2008-02-21 11:47

With a slight rise in Initial Claims and a very weak Philly Fed number, USD/JPY fell to the bottom of the range and triggered our long order at 107.60. It's the end of the Euro/US overlap and with no more reports set to be released for today, I am going to close the trade for a very small loss as I think negative USD sentiment will play out for the rest of the day.

Close position at market (107.58) for a small loss.

Total: -2 pips
-.08% loss

Trade Idea: 2008-02-21 00:56

PoD Chart

With the lack of any major news in the Asia and Euro trading sessions for USD/JPY, I would like to setup a simple range play for the next few hours.

On the chart, we have a rising wedge where we may possibly run into some support and resistance action. Stochastics are trading near overbought, so I like a short around 108.50. This plays well into the interest rate cut sentiment in the US and slowing economic growth in the US. A return to the bottom or the rising trend line should prove to be a nice opportunity to join in the up trend.

Short USD/JPY at 108.50, stop at 108.85, pt1 at 108.15, pt2 at 107.80

or

Long USD/JPY at 107.60, stop at 107.35, pt1 at 107.85, pt2 at 108.10

Remember to never risk more than 1% of your account on any single trade. Please adjust position sizes accordingly.

Good luck and good trading!

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Archived Comments (1)

pipcrawler it seems like your targets were not hit. I have a question, why did you choose such a high target considering that rate was not that close.

"When life gives you lemons, make lemonade."
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