USDJPYPair moved sideways yesterday, moving within 40 pips range. Let’s talk about today’s plan. Buy or sell?
Not too fast! 🙂
Looking at the Daily chart (below), my bias is the same – Bear, as I still see Bearish divergence. I would like to see the price drop down to 55EMA (Blue line).
If we look at H4 chart (below), clearly we see the prices are blocked by the strong resistance of 124.00-124.50 zone, which includes WPP. This chart is in sync with my Bearishness.
Just for fun, let’s take a look at Ichimoku H4 chart. (Yes, people also use H4, not only Daily!) It is interesting to see the candles here are also blocked by the clouds above, hesitating to go up higher. Also we notice Kijun-line and Tenkan-line are about to dead-cross, meaning this Ichimoku chart is about to give us a big Sell sign.
Now the direction is set – Sell.
So how do we sell?
Currently during Asian hours, the price has been dropping down to 124.22 level. When the next Stochastic up cycle is over, I would like to see the price go up to 124.50 again, so that we can sell. That would be my 1st sell zone. If the price doesn’t go as high as 124.50, I wouldn’t mind selling from 124.36 level (DPP). These are my sell zone. The profit target should be 124.00 for both cases, as 124.00 is a hardcore support.
If, however, the price continues to go down without any pullback, and breaks 124.00, that’s a big sell. In that case, wait for pullback and sell from 124.00 (Plan3).
If this break happens, let’s shoot for 123.00 as a target!
In Summer market, we should have multiple options for the trading, as anything could happen quick.
Hope this setup helps you develop your own.
YJ Baik – Forex.Today @ Tokyo