Hello! We saw USD / JPY lower peak after another earthquake in Japan yesterday morning. The couple got enough to turn my business over and then we saw the market rally back higher within the same time. As the weekend was quickly coming to an end, I decided to close my business to avoid the risk of the weekend.
Close manually 85.25
Total: 55 pips / gain of 0.61%
So, a nice swing trade and quick week. The couple dipped lower as we approach the end of the European session, so it will be for me this week. But I’ll keep a watch on USD / JPY higher if it breaks next week, or based upon the same area, looking for me to go long this bad boy again. Until then, thanks for visiting my blog and have a great weekend.
Idea Trade: 04/06/2011 3:42 ET
The Japanese yen has been getting beat like hired mule as in the sense that it will be the last one out of the stimulus. With signs of divergence indicates a reversal may be just around the corner, there will be another opportunity to go on the trend?.
Technically, first we see a sign of divergence in the one hour chart indicating the USD / JPY ‘s rally can go back in the short term. It makes sense since he was a monster to sell the yen in all areas since last week – has Yen has to be to be tired of the booty (as such), right?.
Well, if they are, we see the potential support for PWH (84.74) and using the Fibonacci tool in the recent swing high (83.85-85.53) shows an area of potential support between 84.50 to 84.90. Good places to go long again?.
As mentioned earlier, the feeling that Japan may be the last to pull system stimulation has been the driving force of most recent sell-Yen is (with the intitial be the coordination strength of the G-7 currency intervention) . Specifically, the U.S. From $ 600B from the Fed buying bonds program should continue until June as planned, although as we have seen better employment data on Friday, giving some hope for an early exit. With better economic data and inflation continues to rise, there is now speculation that the Fed could change to a more aggressive attitude in the future.
So, sentiment is strongly in favor of an increase of USD / JPY, and I do not foresee any change in that sense, at least not before the end of this week.
Therefore, my idea of swing trading of the week I’m going to go long in a throwback to the area of potential support. My stop will be the day ATR (90 pips), and will go to 86.50. This is what I do:
Long USD / JPY at 84.70, stop at 83.80, 86.50 profit target in
Remember that the risk no more than 1% of an account on any single trade. Adjust position sizes accordingly.
There are no data points are still important in the U.S. for the rest of the week and we have the nominal interest rate of Bank of Japan tomorrow’s decision, but no change in interest rates or monetary policy expectations. After the tragic events in Japan in March, it is very unlikely that the Bank of Japan will make every effort to hinder their economy (ie, increase taxes or remove stimulus). Technicals should be restricted as no surprise, the feeling changed news – stay at your toes!.
Stay tuned and thanks for visiting my blog!.