Today’s pick will be on the EURJPY again, but this time a little trickier. I drew a fib line on the 4hr chart and as you can see we have a couple of resistance points lining up; most notably the 61.8% fib and the S1 line.
In the morning we have the E-12 PPI and ECB interest rate statement. Now I am looking to go long at 137.88, but if the PPI is a big surprise or if Trichet is soft on his stance on the short term outlook on interest rates I will take my long trade off and go short with a break and candle close below the S1 and fib line. Going for 10 pips either way with a 30 pips stop. My aggressive target would be the pivot point in the long direction or the S2 line in a short play. I know initially, it’s a bad risk to reward ratio, but I think it’s a high probability trade in either scenario.
If the pair goes long I’m looking for a reversal at the R1 line. Short at 138.87 with a 10 pip profit target and 30 pips stop. Again if the news is a big surprise and causes a strong move then take the short trade off and look to go long.
Today’s pick isn’t really a “set it and forget it” trade, so you’ll have to be alert during those news times of 5:00 am EST and 7:30 am EST.
Buy EURJPY @ 137.83
SL @ 137.53
PT1 @ 137.93
PT2 @ 138.23
Short EURJPY @ 138.87
SL @ 139.22
PT1 @ 138.77
PT2 @ 138.38
SL = Stop Loss; PT1 = First Profit Target; PT2 = Second Profit Target
This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.