Loonie bulls were off to a strong start this week, pushing CAD/JPY all the way up to my profit target for a neat 1.44-to-1 R:R on this setup. In case you missed it, take a look at my initial trade idea and my latest updates first.
After spotting an upside breakout from a long-term descending channel, I made use of multiple time frame analysis and zoomed in to the 1-hour chart to spot potential entries. I was able to go long at market (83.25) then I added to my position on stronger bullish momentum later on.
I actually thought that price missed my PT at 87.75 by a few weeks last week, but the pair gapped up over the weekend and hit my target straightaway. As it turns out, non-OPEC oil producers have expressed their commitment to trim production levels along with the OPEC members in order to help stabilize the oil market.
By the looks of it, the pair ain’t done with its climb just yet as it is still moving above the rising trend line on the short-term charts and looks prime for a retracement. We’ve got the FOMC decision coming up this week and I think the resulting moves on USD/JPY could spillover to other yen pairs, possibly taking CAD/JPY back down for another test of support.
Until then, I’ll continue to keep my one good eye on this pair’s rising trend line support around the 86.50 minor psychological level for a chance to get back in the uptrend and grab a few more pips before the year comes to a close. For now, here’s what I got:
P/L: +355 pips (average) / +0.72%
Looking back, I’m pretty happy with how I managed this trade since I stuck to my risk management plan and pressed my advantage when I got the chance. I also rolled my stop up along the way in order to limit my exposure and lock in some gains.
As always, don’t risk more than 1% of your account on a single trade and make sure you read our risk disclosure if you’re thinking of taking the same setups.
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