Lowering Stop in Short USD/JPY
USD/JPY continues to come under pressure and fell to levels today not seen since the surprise QE announcement by the BoJ in October of 2014. This is obviously a zone of psychological importance so the volatility we are seeing (and talk of possible intervention) around it, this morning is not all that surprising. The exchange rate is also well below its 1-year standard deviation channel which is usually a decent metric for identifying markets that are oversold so the risk is rising for a multi-day counter-trend recovery in my view. This is all countered by the clear year-long head & shoulders pattern that was triggered earlier this week as it suggests the risk for a broader liquidation remains high. I am lowering my stop to just above 113.60 and letting things play out.
Short USD/JPY from around 121.50. Took profit on ½ of original position near 119.38. Lowering stop on remaining position from 117.60 to just over 113.60.
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