Inside technicals and chart patterns by Raghee Horner, trader and author at Raghee.com
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….here’s a great set up to capitalize on that weakness. The USD/CHF moves directionally with the U.S. Dollar Index so as the dollar weakens the franc strengthens against it and you get the push lower on the chart below.
Watch for 1.0900 support as price approach the major psychological level of support.
While waiting for a longer term time frame set up to trigger you’ll often find that short term charts hold the key to getting there. That’s the case with the trend follow on the daily dollar-yen and the 240 minute falling wedge below.
Consider that the daily chart needs a rally to reach the downtrend line resistance and simulataneouly a break through resistance on teh 240 minute chart would be a first step in that move. That’s why it’s called “one thing leads to another” and why there can be a longer term short set up while playing an intraday long set up as in the case of the falling wedge alert.
How are you playing the downtrend in the JPY/USD?
The dollar-yen on the daily chart shows what we’ve known for some time: The USD/JPY is in a downtrend as the yen strengthens against the dollar. So what’s the play here?
First, as long as the trend is down I’m looking for a short off a ceiling. The short would be set up by a bounce in the downtrend - in other words a short off short-term strength.
- Raghee