Pick of the Day: USDJPY – Trade Closed

Trade Closed: 2009-10-14 07:50

PoD Chart

Good morning! It looks like I couldn’t catch a break on my remaining position as USDJPY didn’t quite reach 88.00 before buyers jumped in and took the pair back above 90.00. Needless to say, I closed out the rest of my position at break even.

1st Half: +120 pips
2nd Half: +00 pips
Total: +0.50% gain

It looks like USDJPY is going to hang around 90.00 for a bit longer, but with recent reports of central banks loading up on more the euro and Yen rather than greenbacks, we may see the USDJPY continue. I will continue to watch 90.00 – 91.00 for resistance behavior and another opportunity to jump back in short.

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Trade Update: 2009-10-05 08:24

Good morning! Just a quick update on my short USDJPY trade. On Friday, NFP came out with a surprise to the upside as the government reported that 263k jobs were lost in September and the unemployment rate ticked up from 9.7% to 9.8%. USDJPY quickly dropped below 89.00 after the report, where half of my position was closed to lock in a profit. I adjusted the stop on my remaining position at break even (90.20) and will continue to target my second profit target.

The pair is currently trading just below 90.00, where I think buyers will be held at bay for now. Deficit concerns are still plaguing the US Dollar and unless we see a reason for the BOJ to take currency intervention measures, the trend lower may resume.

Of course, this week’s economic calendar may be the deciding factor on which way the pair goes, along with the affect of earnings season on risk sentiment. Should be a fun ride, so stay tuned!

Trade Idea: 2009-09-28 09:31

PoD Chart

Good morning Forex fanatics! I see my usual technical setup forming on USDJPY. The Yen has been on a roll against the greenback, so will we see the downtrend in USDJPY continue?

Again, it is a simple technical setup. The pair has been trading lower on weak USD sentiment, and now trading off sentiment that the Bank of Japan will not intervene in their currency. After hitting lows around 88.30 at the open of this week, the pair has bounce back higher above 89.00. Using the Fibonacci tool, we can see potential resistance areas between 89.90 – 90.90, which happens to line up with previous support that was broken. Is it potential resistance now?

It could be, and I look to go short in the area if the market retraces higher. Stochastics are just pulling out of oversold conditions, so we may see USDJPY hit those Fibonacci levels.

Plenty of data in the Forex calendar this week to mix up market action. Most notables for USDJPY is US GDP and Non-Farm Payrolls. These are high impact events, so I’m gonna watch my position closely during these events.

So, I have a technical short setup where I look to go short at previous resistance. My stop will be 120 pips (daily average true range), and I will target the previous swing low, and major support areas around 87.00 last seen back in January. Here’s what I am going to do:

Short USDJPY at 90.20, stop at 91.40, pt1 at 89.00, pt2 at 87.00

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

Thanks for checking out my blog and stay tuned for updates!

Forex Q&A

  • BeerMonster

    Interesting. On the daily chart, I’m seeing the possibility of a reversal. Not sure how strong it will be though.

  • cprao

    Stochastics setup on your chart is 14,3,3, right? Please confirm.

  • BeerMonster

    Interesting. On the daily chart, I’m seeing the possibility of a reversal. Not sure how strong it will be though.

  • cprao

    Stochastics setup on your chart is 14,3,3, right? Please confirm.

  • Pipcrawler

    Thanks for the comments. Yes cprao, stochastic settings are 14,3,3.

  • Pipcrawler

    Thanks for the comments. Yes cprao, stochastic settings are 14,3,3.

  • fromJDtoFX

    does the doji/hangman on the the daily chart effect this trade at all (signaling a possible reversal), or are we banking on the long/med term downtrend following through after a retracement? I can never figure out how to resolve the many conflicting signals that one sees on the various charts (intraday, daily, etc.), with the prevailing trend(s) (long/med/short,etc.).

    Thanks!

  • fromJDtoFX

    does the doji/hangman on the the daily chart effect this trade at all (signaling a possible reversal), or are we banking on the long/med term downtrend following through after a retracement? I can never figure out how to resolve the many conflicting signals that one sees on the various charts (intraday, daily, etc.), with the prevailing trend(s) (long/med/short,etc.).

    Thanks!

  • fed

    it has been 3 days, anyone gave up on this pair? It even look better now, I mean Last night it did hit the resistance trendline and things picked up a lil but not it is still retracing. See what happens, I might close my entries before nfp hits tomorrow. Hopefull the asian and euro open will have a positive impact to this pair.

  • fed

    it has been 3 days, anyone gave up on this pair? It even look better now, I mean Last night it did hit the resistance trendline and things picked up a lil but not it is still retracing. See what happens, I might close my entries before nfp hits tomorrow. Hopefull the asian and euro open will have a positive impact to this pair.

  • fed

    yes finaly broke the short term suport line around 89.40.

  • fed

    yes finaly broke the short term suport line around 89.40.