This is not a fresh buy idea for myself, but a follow up from my previous post on a possible retracement of USDJPY.
In such a scenario, I am looking at 114-114.05, which is the 23.6% retracement of fall from 118.65 and 50% of fall from 115.40-45.
Upside of 114, 115.60 could be the next retracement target. BUT, lot of barriers to be crossed before that.
Could USDJPY have reached its sweet spot? Only time will tell, and charts of course 
But for now, I’m taking a look at the H4 chart at current levels.
I’ve marked the areas of interest with arrows, areas that I had scribbled in a previous post. The RSI did stay inside it’s descending wedge and turned upward towards the upper TL of the wedge. And that brought the price to the lower channel of its descending wedge, that it had broken below yesterday.
2 possibilities come to mind –
Bullish break of price into wedge and further bullishness in its attempt to break out of wedge higher. This should allow RSI break its wedge and shot higher. 114 should be the target in that case. However, to note how hourly candles attempt to take support at the lower TL of wedge.
Sellers chip in at near 113.50 levels again and bring the price down. RSI should recoil within its wedge in this case and we could be back to square one.
But nothing taking away from the opportunity that day traders are getting out of this pair at the moment, as the M5 chart below suggests.
Gotta keep an eye on this index to counter any severe losses on my short position, as the H1 chart seems to be wanting to break out higher.
Well, it’s Draghi day tomorrow, so gotta keep insurance ready, if it needs to be actioned.
Pretty straightforward on the H1 chart below.
Price is in a falling channel, but yesterday’s sharp rebound puts things back in perspective, if this channel wouldn’t be able to hold prices eventually. Current candle in this chart is shaping up, and I might think of purchasing insurance if price breaks out of channel higher, as then the previous wave highs during the drop from 11670 levels would become targets.
However, there could be volatility in European and American sessions again today, with Euro and US CPI in the radar. So gotta be careful that I don’t get sucked into false moves in price.
Insurance taken with a long position from 11575, locking my losses in DAX30 for the time-being.
I guess this possible HnS is more of a wishful thinking that am having at the moment, but would be keen to see if it plays out. Should reach the TL at the least. A good 40-50 pips in the offing probably.
H1 chart here.
XAUUSD seems to be losing the shine on the H4 chart.
Remained contained in the triangle and now testing the upper TL of the rising channel it broke out of 1-2 days ago. While falling back into the channel is possible, I’d be keen to see if retest of the lower end of the channel could be in the cards. The lower TL of the rising channel is a support since 1135. So that could be some serious test for short term bulls.
A compelling case perhaps for entering a short position at 1.0680.
No fresh peaking of RSI with the price rising in a channel for 2 weeks. Interesting!! Worth a short I think.
H4 chart here.
I guess it’s enough to say, that the KING has roared back and slain all that stood in it’s path!!!
I had used term ‘barriers’ in my post about buying dollar yesterday, but I guess the charts would now make that phrase look as an understatement. Am yet to look at this pair’s chart this morning, so will probably think later what to do with my long positions.
But what a paradise of a day for day traders 18th January 2016. BIG swings across the board!!
Swinging by the dollar!!
The move in Euro since CPI release yesterday summed up why I thought it should drop.
RSI in no agreement with the price and now, has broken the supporting TL that it been maintaining in the recent correction.
Possibilities come up for a drop till the lower end of the channel or the Ichimoku cloud top. However, it could all come down to timing for trading this pair.
Not good signs on Draghi day!! Time to be cautious unless some knee jerk reaction happens!!
H4 chart here.
A look at the H4 chart for this pair.
I had scribbled about 1205 being a possibility, so this target has been reached.
But the candle off the upper TL of the rising channel doesn’t ease matters. 1205 seems to be the defining point for now. If it can’t stick it’s neck higher and stay above this level, some key downside targets would come into play - 1190, 1174.
Fib-struck for now!!
So the possibility# 1 from my previous post took shape and both price and RSI have broken above their respective wedges.
But for now, the price is stuck between 2 Fib levels, 114.533 - 23.6% retracement of the rise from 101 levels and 114.880 - 38% retracement of the drop from 118.60 levels.
So I’ll be monitoring price action in this range for now. Though looking at the ranges, and also the Fibs on the rise from 112.60/70 to 114.80, 113.90-114.30 could act as a floor for now if price retraces a bit from its holy smoke 200+ pips rise.
Executed a fresh short position on this pair from 38% Fib of the fall from 1335 targeting the supporting TL from 1135 on H4.
Price reached 115.60, that I had mentioned in a previous post, thus allowing me to close my long position from 115 levels.
This was kinda timely as I wanted to have them closed before January 20.
Haven’t looked at current chart. No fresh positions for this pair in radar as I’m travelling at the moment and would be in trade-light mode till Tuesday next week.
Dayyaaammnn!!
I told myself to not look at the charts but just couldn’t keep my eyes away :13:
A possible inverted HnS could be in play for USDJPY on H4. and if it plays out, 113.70-114.05 is the area to look for the drop before a parade to 116.80. If I remember correctly, that was where’s it sold off in last week or so.
Some brief notes.
Have got a long USDJPY at 113.868 and a short XAUUSD position at 1215.92 taken. Quick look at the charts got the dollar to drop as scribbled before, getting to my entry point.
Not able to post charts from phone now, but would see if I can when am back at my terminal.
Another long dollar yen entered at 113.35 levels.
Back home, back at my terminal, back to some work!!
Not the most greenish of welcome back on my positions though 
Some more notes here on my positions taken yesterday.
[ol]
[li][B]Buy USDJPY[/B]
[/li]The price dropped from 115.30 levels following the inverted HnS pattern I was expecting. Though if one looks at H4, there were more clues to this drop as well - notably a potential HnS on RSI at exactly the same price point, the upper TL of the falling channel the price has been comfy in this month and the Ichimoku cloud bottom level had been reached as well.
So sellers had a field day.
I had entered a long position at 113.80 levels anticipating rebound at the right shoulder on the inverted HnS. Price continued to drop further though with a break of 113.50 and now I note on the charts that the HnS on RSI hadn’t played out completely when the price was at 113.70-80. So this pattern played out eventually with the price dropping to as low as 113.20. I had entered another long position at 113.35 levels with a concurrent green candle on H4 in line with the uptick in RSI after completion of HnS.
This was targeted as an intraday trade for the rebound + retracement.
For now, I’m expecting a bullish divergence on the H4 RSI, so continuing with my long positions and might enter more if more supporting clues are visible on the chart.
[li][B]Sell XAUUSD[/B]
[/li]Though this was an add-on trade to take advantage from a rise in dollar yen, there is a bit of catch on this one on the H4 charts. RSI isn’t nodding its head to the price movement in entirety. Similar to what I see on EURUSD. So I doubt if these pairs have enough horsepower under their hood for the kind of ride they’re attempting.
Am cautious on any upside for now, as it could easily be a topping process happening at 1205-1220 levels. Let’s not forget that it has done an almost 100 km trip from the lows in December 2016, so you never know when it decides to pit-stop.
[li][B]Sell GBPJPY[/B]
[/li]This was taken as insurance for the short yen position taken at 115.80 levels. Contained between 2 descending TL’s for now on H4 and indicators don’t look any encouraging either.
[/ol]
Perhaps some more clues could be rolling in for a potential double bottom at 112.60-70 levels.
[ol]
[li]Double bottom reversal
[/li][li]Bullish pin bar in formation
[/li][li] RSI ticking up for a bullish divergence
[/li][/ol]
H4 chart here.
Have locked my existing short GBPJPY trade with a long position, before Brexit related news had to come out today.
Gonna let this piplock roll now, till the dust settles down as Trump’s meeting with May later this week could be a potboiler for the Pound too.
Meanwhile, yen been weakening in Europe, so that was another reason to lock in with a long position.
H4 chart here.
Trendlines mention in previous post still contain price, net would be keeping an eye on daily close for today.
