[TW] 03-26-2012 USD/JPY Short by Arrrrgon

Long or Short: SHORT

Entry Point: 82.90

Stop Loss: 83.30

Profit Target: 81.50

Reward-to-risk Ratio: 3.5:1

Risk percentage: 5%

Indicators: 10SMA(Red), 200SMA(Yellow)

Trade Rationale: I am basing this trade off of both the daily and the 4 hour time frames. The daily time frame seems to have changed into a downswing. The 4 hour timeframe is currently rising back towards 83.00 which I believe has turned into our new resistence. You can see my yellow resistance line and the 4 hour candles that have bounced off of it. I plan to make my entry after the next bounce off of the 83.00 resistance line. I will be watching the 1 hour chart to see if any candles are rejected off of the 83.00 resistance. My target is 81.50 because I believe the 200SMA may act as a support around this point.

Trade Adjustments: I will either cancel this trade or wait to enter it if we do not get another bounce off of the 83.00 resistance line. If a 4 hour candle closes above the resistance line, we could be looking at a retrace to 83.50 or 84.00.

I realized I noted the 10SMA but never said what it was used for. I use this on the daily chart to help me determine the direction of the trend. The only use it has for this trade is that I believe we are in a daily downtrend.