Yesterday’s comments by President Trump about the strength of the USD sparked a sell off and at the moment though, price action is stable, at least temporarily. This is not the first time President Trump administration is making such statements. Earlier on, referring to the strong USD which makes US enterprises and products less competitive in the international market, Trump’s aides said that the Euro, Yen and Chinese Yuan were so undervalued that the US had no chance to compete as their currencies gave them an upper hand in businesses. Sell off extended from the NY session into the Asian session before the USD found some support partly because of the reversal of sentiments from Trump. Of note is the way he is now emphasizing on how health care reforms are on top of his priority more than Tax reforms. He also hints on a possibility of rehiring Yellen as the Fed chairperson while also saying that China is not a currency manipulator. Earlier in the Asian session, the AUD recovered from those strong employment data while positive trade data from China lifted the Aussie further.
I would want to ride with this stabilizing USD and short the Yen while following cue of the 4HR chart. This will be purely intraday trading and this will turn out as follows:
Stop Loss: 108.90
Take Profit: 110.15 for a 1:4 risk reward ratio and support in the 4HR chart.
Have a good trading day.