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My my, commodity currencies have been on a tear these days! I’m seeing more bullish momentum on AUD/JPY as it continues to move inside that long-term channel I’ve previously hopped in.

Long AUD/JPY Trade

More than a couple of months back, I took a long position when AUD/JPY started bouncing off the bottom of its ascending channel visible on the daily time frame. I was able to hop in at 86.00 but decided to book profits before 2017 came to a close.

But now when I look at the chart of this pair, I can’t help but wish that I just let my position run!

AUD/JPY Daily Forex Chart
AUD/JPY Daily Forex Chart

Of course there’s no use crying over spilled pips, so I just tried to focus on whether or not I can still make profits off this pair’s strong uptrend.

Fundamentals suggest further gains for the higher-yielding Aussie as risk-taking is in play, mostly due to positive geopolitical developments and the IMF’s growth forecasts.

The BOJ’s adjustment to their long-term bond purchases earlier this month gave me a chance to hop in on a slight pullback to the mid-channel area of interest. I waited for the 88.00 handle to hold and after BOJ Governor Kuroda reiterated that they’re carrying on with their aggressive stimulus program.

This brings us to this week’s BOJ decision, during which policymakers might reaffirm their plans to keep pumping the Japanese economy with cash to shore up inflation. This could lead to another move lower for the yen, as bulls would likely be disappointed that the central bank isn’t looking to taper anytime soon.

I was able to catch a bounce around 88.35 and I placed my stop below this month’s lows and the 87.00 handle. I’m looking at a profit target around the channel resistance near 92.00, and I’ll trail my stop once price tests the major psychological 90.00 mark.

What do you guys think?



See also: Q4 2017 Trading Performance Review

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