I was looking at various Yen charts this morning and found some interesting comparisons. I’m going to consider USDJPY, GBPJPY and then an odd pair for me, NZDJPY to try and show you what I am seeing.
I think the only sensible approach to USDJPY right now is to consider it in the wedge I have drawn. Your options are to try and trade rejections from the upper and lower trendlines or wait for a breakout and trade that. I’m waiting for the breakout.
One could make the argument for the bears being in control of the Dragon. Price pushed lower and is now consolidating in an upward sloping channel. However, the lower channel trendline seems to have supported price quite well in the past and may be the reason why price isn’t able to break down lower. Critically, we’re yet to see lower lows, which we should be seeing if the bears are boss.
Now here is a Yen pair that’s showing its hand. A lovely breakout over early November, an extensive consolidation below support at 77.30 and finally a push higher last week.
NZDJPY is a market I’m interested in, and I’m going to be looking for bullish price-action at the 77.30 area to go long, as simple as that.
I decided to stay away from EURUSD last week, and I’m happy with that call. I now count two fake-out moves, one on a close above 1.1430 and the other last week, when price closed below 1.1300.
Either you attempt the trade the shared pair inside this range, or wait for a breakout and retest, with an example shown above (if the breakout happens to be to the upside). I suggest waiting.
The Loonie Looked Likeable for a short Last week and what I see now suggests that the trade is on its way. We finally have price closing below the supporting trendline, and (this is important) making a lower-low structure.
I have picked 1.3150 as my line in the sand. I would like to see price close below this level (meaning we most definitely no longer have higher-lows in play) and retest it from below (like EURUSD example) to short. I see no reason why we can’t target the October lows, about 350 pips away.