USD/JPY Trend Traders Wait for a Breakout
Market Condition: USD/JPY Daily Breakout
Target 1:2x ATR105.53
Target 2:4x ATR103.45
Invalidation: New Higher High
(Created using Marketscope 2.0 Charts)
The USD/JPY is currently rebounding from yearly lows at 107.62. As prices continue to retrace, traders may set pending entry orders to plan for the pairs next breakout. Entry orders may be set as close as 1 pip below the low at 107.61. This way, a sell order is triggered on the creation of a lower low. In the event that a pending order is triggered, traders may use ATR to manage risk and extrapolate potential profit targets. Currently daily ATR reads at 104 pips. When managing risk to 1X ATR this places stops near 108.61. Initial profit targets of 2x ATR may be found near 105.53, while secondary targets using 4X ATR may be found at 103.45.
In the event that prices fail to breakout lower, any entry orders to sell the market will remain pending. In the even that prices trade to a higher high above 109.73, traders may consider deleting any remaining entry orders.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.