The short in USD/JPY from last week has played out nicely. I was looking for a secondary failure against the 200-day moving average near 121.50 and we got that on Monday. The move lower that has followed has been fairly aggressive and seen several key supports eroded including the 38% retracement of the move off the January low. Focus now is on the 3rd square root relationship of the year’s low around 119.20 and the 50% retracement of the year’s range around 118.80. A move under the latter would further help the broader downside resumption argument. That all said, I like to take at least partial profit on trades that move 2-3x the initial risk and with spot now hovering around 119.50 I will take off half and move the stop on the remaining position to cost.
Short USD/JPY from around 121.50. Took profit on ½ position here (spot ref: 119.38).
