USD/JPY Breakout Opportunity on Invervention
After remaining range bound for over a week, the USD/JPY slid below another key psychological level on Friday, below 76.000. Now, with the all-time low set at 75.936 for the time being, Japanese governmental officials made the rounds over the weekend and at the start of trading this week by further suggesting that they are “watching” the markets once more. As such, various strategies are outlined below as to best capture any dramatic upside moves in Yen-crosses.
Please note that the trade recommendations contained here within are advised only under the pretext of an intervention to weaken the Yen, as broader macroeconomic trends are dictating further market uncertainty and thus capital flows into the safe haven currencies in the near-term, and any appreciation of currencies against the Yen, in the author’s opinion, are likely to be short-lived.
USD/JPY Hourly Chart: July 28 to August 22, 2011
Charts created using Strategy Trader– Prepared by Christopher Vecchio
- Long: Place an entry at 77.575 [38.0 Fibo]
- Stop: Set the stop to 76.948 [23.6, 63-pip risk]
- Target 1 (Reward/Risk Ratio): 78.081 [50.0 Fibo] (113/63, 1.81)
- Target 2: 78.587 [61.8 Fibo] (164/63, 2.61)
- Target 3: 79.214 [76.4 Fibo] (227/63, 3.61)
- Timeframe: 12-hours following intervention
Pivot Table: Yen Crosses
Written by Christopher Vecchio, Currency Analyst
To contact the author of this report, please send inquiries to: firstname.lastname@example.org
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