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Selling Pivot for USD/JPY?

Posted on May 26, 2009 at 18:48 in Trading Desk by Ryan O'Keefe

Howdy folks!

So equities rally, Dollar gets beat up and USD/JPY is boring to watch as usual but it looks like the short idea I talked about yesterday may be getting closer. Tonight I’m watching the support pivot at $95.60 which gave way last week. This has been a decisive area of support on the daily chart over the last few months and now we are going to test it from below.

Now comparing that to what I see on the four hour chart, I like the idea of selling around $95.60. Ideally I can join the daily chart head and shoulder breakout at a bargain price on it’s way to a lower support level.

I’m planning a short at $95.60 but if things go horribly wrong I’ll be stopped out around $96.60. See the daily chart below for my longer term target on this trade. I’d like to see the pair fall back to support and a 61.8% pull back around $92.70. Risk to reward is just shy of 1:3.

Stay tuned….

IMPORTANT NOTICE: These comments are for information purposes only. My opinions or other information contained in this post do not constitute investment advice. It should not be understood as a direct recommendation to buy or sell any currency contract or other investment vehicle. Forex trading involves substantial risk of loss and is not suitable for all investors.

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