FX:AUDJPY Australian Dollar/Japanese Yen
At end of trading on Friday price action leaves us at a good previous support area (structure). We are also oversold just. There's a turning zone and I've demonstrated risk/reward as it is now, it could turn on a dime. Personally I'm not comfortable with a 100+ pip stop loss and so would like to see price action go downwards more to lessen that before entering this trade which would give us a much better risk/reward and smaller stop loss. Look for PA to return to the last good structure level.
There's also a long term Cypher pattern on this pair, that will trigger an entry in the 90.45 area. Easy to see this on a Daily chart, with the X point starting in February 2014. The Stop Loss would have to be over 220 pips, so I won't be trading it per se, but if price goes down to the entry area, I'll be looking for other signals, with much smaller stops, to take longs.
Hello Gary, The daily decline on the last trading day (FRI) has been the largest bearish candle since the bear move started on this pair on 24 Nov 2014. This probably indicates we are in the middle of wave 3 of the decline. This suggests another 400-600s pip to the is most likely in the way. Also look on the decisive close on the weekly Time Frame. Your idea my work out to some level, but I believe the Buy limits order are too risky. One better way is to wait for spotting a daily pin bar in the kill zone and place a Buy Stop order based on that. Good Luck- Hamed.