Dear Happy Traders,
This is NFP day. Â So I don’t trade until NFP announcement today. Â Â Thus no Trade Setups.
It may be a good opportunity to sit back, relax, and observe the big picture here.
Japanese YEN has been getting very strong for the last couple of days, being one of the safe-heaven currency. Â As a result, all yen-cross pairs dropped dramatically.
We tend to believe “USDJPY was red yesterday. So it will go down today? Â Wait a minute! Â My long term bias is Bull. Â Is it going to reverse and head up again??”. Â Â There are so many uncertainties on the market, and I am hoping today’s NFP can blow away those uncertainties.
I thought about writing Ichimoku study of Yen cross pairs. Â Typically I use Daily Ichimoku. Â However, I just found out Daily Ichimoku charts of all Yen cross pairs simply show “STRONGEST SELL SIGN”, that is not interesting.
Thus I would like to show Weekly Ichimoku chart. Â Perhaps Daily Ichimoku is the most widely used timeframe for Japanese institutions and hedge funds. Â However, Weekly chart is also popular.
The most interesting pair is EURJPY.
Since April, EURJPY was on the up move. Â However, since last week, the price has dropped dramatically, and we can observe that was because of the big & thick clouds, resulting the candles dropped down. Â This is a big bearish clouds, and it would be very hard to break this clouds up. Â Naturally, we should set the bias for EURJPY as Bear … for a long time.
The above is USDJPY pair. Â Overall, this is still up-trend by the fact that candles are floating above the clouds. Â Note that the big drop of Aug 24th, was supported by the clouds! Â (Wow!) Â Â Also Delayed line (formally it is called Chiko-line) is touching the candle now, meaning the market direction is neutral. Â However, we can read this chart as … “Thich Bullish Cloud is coming. Â So we can expect the resume of the up trend sometime soon. Â Even if the price temporarily drops, it should be supported by the clouds. Â Thus 116.0 – 117.0 area should be EXTREME bottom”.
The last pair is GBPJPY. Â Even though this pair has dropped 1500 pips (!!) in 2 weeks, the weekly chart still shows “STRONGEST BUY SIGN”. Â Â We can expect the up move will resume soon as the thick Bullish cloud is coming toward us. Â Temporarily the price may go down further. Â But remember the EXTREME bottom should be 180.00 ish, as this is the top of the Cloud.
Hope this analysis helps you develop your long-term bias. Â Please remember these charts are WEEKLY charts. Â So I was talking about the next 4-10 weeks!
YJ Baik – Forex.Today @ Sapporo