Forex Trade Ideas: Selling USDJPY Long, Going Short
I will close my long-standing USDJPY position, which I had first opened in September of last year. This is not a decision I take lightly. But I think the risk of reversal is too great.
Instead I'd like to go short now and target a noteworthy retracement. I'll take a short from current market price (89.73 at time of writing) and close the position on a daily close above 90.
WIth the Bank of Japan decision looming, I think there's clear risk of volatility. The important thing to note is that most expect the Bank of Japan will double its inflation target and announce aggressive monetary policy easing. But that's been mostly priced into current price, in my opinion, and is unlikely to force USDJPY strength.
Instead I see substantive risk of correction and will trade accordingly.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up to David’s e-mail distribution list via this link.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.