Awaiting a Major USDJPY Breakout or Trading the Range
• When we are focused on a particular trade scenario, other opportunities may be overlooked
• Asking ourselves 'when would I range/trend/breakout trade this' can keep us flexible
• I look at USDJPY from a different view than how I have analyzed it over the past few months
See volume behind the majors during events like Firday's NFPs to gauge your trading approach using the free FXCM Real Volume and Transactions indicators.
Different traders can find different opportunities from the same currency pair. Trading style, time frame and trade management can translate into successful setups on the same pair by participants with very disparate approaches. However, we don't need to ask someone else for their analysis of a market to appreciate its different angles. We can do this ourselves. For example, I have been keeping a close eye on USDJPY, awaiting a technical break from a clear wedge pattern and a seismic shift in fundamental conviction to leverage a long-overdue risk aversion theme. The potential is exceptional, but it requires patience and a definitive catalyst. As I wait for this high-profile long-term development though, I have missed an opportunity in the near-term that has resulted from the same factors that stage the eventual break. Asking 'under what circumstances would I trade this as a range, breakout or trend,' we may come across trades we didn't consider before. We discuss this in today's Strategy Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.