Forex Strategy Video: Proper Trendline Trading with USDJPY
• A dip below 97 drew many traders into a false trendline break on USDJPY
• There are critical elements to make a trendline: time frame, minimum tests, visibility
• Yet - as with everything - context counts when we are looking for a true break or reversal
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Any two points make a line. That does not mark, however, a high-probability trading pattern. Many traders were drawn in Friday as USDJPY slipped below just such a prominent trendline. Yet, a quick reversal proved the break a false one and left many traders scratching their heads. Is the trend of 2013 swing lows not an important technical level? What does that say about trendlines on pairs like GBPUSD, EURJPY, USDollar and S&P 500 amongst others? In the Weekend Forex Strategy Video, we discuss what makes for a trade-worthy trendline setup.
Expect breakouts? Use the DailyFX Breakout 2 strategy to signal or confirm setups!
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.