Up and at ’em, forex brothas! Let’s start the week by checkin’ out these hot trend setups on USD/JPY and CAD/JPY. Think you can get pips from these swing and position trade plays?
Remember that retracement opportunity that we spotted on CAD/JPY a couple of days back? Well, it looks like it’s go time for the bulls and bears!
CAD/JPY is lollygagging around the 90.00 major psychological handle, which lines up with not only a 38.2% Fib, but also a rising channel support that hasn’t been invalidated since early August. This time around a bullish divergence popped up to support the bulls.
Buying at current levels could still get you a pretty sweet deal especially if you aim for the previous highs near 91.50. If you’re no fan of the Loonie, though, then you could also wait for a break below said support levels and trade a downside breakout instead. Watch this one closely for cues on its next direction!
Don’t think the yen will see more losses this week? Here’s one for you! USD/JPY is having trouble breaking above the 112.50 psychological handle, which isn’t surprising since it’s right smack at a falling channel resistance on the daily time frame.
With stochastic chillin’ like ice cream fillin’ on overbought territory and the pair sporting a tweezer tops-like action, you can bet your pips (with proper risk management, of course) that other bears are also watching this one.
Shorting at current levels could give you a good reward-to-risk ratio especially if you aim for the previous lows near 107.50. Take care to use wide stops, though, as yen pairs like this one (and on higher time frames, too!) could see more volatility than your average currency pair.