USDJPY → Aiming for 176.500!? Let's Dig In.
USD/JPY broke ascending triangle pattern at the 152.00 Resistance level per my last analysis. Since then, we have seen the completion of the measured move to 154.500 followed by a third leg up to 158.350! Is this the moment to long? Or are we in for a hard sell-off?
Previous Analysis:
How do we trade this? 🤔
I would not long the market open. After a strong Friday push, traders are far more likely to take profits, likely pulling the price down to the 156.000-157.000 range with the possibility of a hard wick to the 153.000-154.000 area. That being said, we should remain long-biased and buy these pullbacks, as USD/JPY has been on this bull trend since January 2021.
This trade pertains to the Weekly timeframe. I would drill into the 4HR and Daily to find more precise entries. It's reasonable to assume the pullback at this level, so we should look for a bounce at one of the key areas mentioned and enter a long position. On the Weekly, aim for a first take profit of 169.500 where half the position is taken off the table, then move the stop loss up to the entry price. The second take profit should be taken just before the 1978 key level of 176.900.
💡 Trade Idea 💡
Long Entry: 156.700
🟥 Stop Loss: 150.300
✅ Take Profit #1: 169.500
✅ Take Profit #2: 175.900
⚖️ Risk/Reward Ratio: 1:3
🔑 Key Takeaways 🔑
1. Breakout of key 152.000 price level
2. Strong bullish price action completing the measured move to 154.500
3. Third leg to 158.350 complete, wait for a pullback
4. Enter a 1:3 Risk/Reward trade taking half profits at 1:2 Risk/Reward.
5. RSI at 74.00 and above the Moving Average, supports pullback.
💰 Trading Tip 💰
The longer a trend continues after 3 legs, the probability of that trend continuing lessens. Because of this decreased probability, we ought to reduce our risk when entering trades.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and Follow to learn more about:
1. Reading Price Action
2. Chart Analysis
3. Trade Management
4. Trading Psychology
Previous Analysis:
How do we trade this? 🤔
I would not long the market open. After a strong Friday push, traders are far more likely to take profits, likely pulling the price down to the 156.000-157.000 range with the possibility of a hard wick to the 153.000-154.000 area. That being said, we should remain long-biased and buy these pullbacks, as USD/JPY has been on this bull trend since January 2021.
This trade pertains to the Weekly timeframe. I would drill into the 4HR and Daily to find more precise entries. It's reasonable to assume the pullback at this level, so we should look for a bounce at one of the key areas mentioned and enter a long position. On the Weekly, aim for a first take profit of 169.500 where half the position is taken off the table, then move the stop loss up to the entry price. The second take profit should be taken just before the 1978 key level of 176.900.
💡 Trade Idea 💡
Long Entry: 156.700
🟥 Stop Loss: 150.300
✅ Take Profit #1: 169.500
✅ Take Profit #2: 175.900
⚖️ Risk/Reward Ratio: 1:3
🔑 Key Takeaways 🔑
1. Breakout of key 152.000 price level
2. Strong bullish price action completing the measured move to 154.500
3. Third leg to 158.350 complete, wait for a pullback
4. Enter a 1:3 Risk/Reward trade taking half profits at 1:2 Risk/Reward.
5. RSI at 74.00 and above the Moving Average, supports pullback.
💰 Trading Tip 💰
The longer a trend continues after 3 legs, the probability of that trend continuing lessens. Because of this decreased probability, we ought to reduce our risk when entering trades.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
Like 👍 and Follow to learn more about:
1. Reading Price Action
2. Chart Analysis
3. Trade Management
4. Trading Psychology
-Joe Dean
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Trader Engineering Course (Coming Soon!)
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