After strong resistance holds and a rising trendline break, I’m taking a swing trade to play my bearish bias on CHF/JPY!
CHF/JPY Trade Setup
I’m a fan of the Japanese yen over the Swiss franc fundamentally, and if you wanna see why you can check out my CHF/JPY Watchlist post from last week. I think a lot of what I argued still holds true today, and with the Bank of Japan giving a positive outlook this week, positive sentiment could hold for the Japanese yen in the short-term. Also in terms of sentiment, last week’s Commitment of Traders report shows that the big boys are cutting down their yen short positions in the futures market over the last four weeks, which could be a signal of moves in the spot market as well. So, I’m taking a swing trade that may likely run for the next week or two as I use the daily ATR to set my stop and max target.
Short CHF/JPY at market (113.65), stop loss at 115.50, max profit target at 110.00 for a near 2:1 return-on-risk. I’ll be risking 0.5% of my account on this position and if that minor support area around 112.50 is broken, I’ll look to re-assess to potentially reduce my risk and maximize my gain.
As always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.
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