In our previous post we spotted a higher probability selling opportunity on AUDJPY. Since then we have seen in the price action a potential intra-day buying opportunity with a similar convergence of factors.
As you can see from the 15 Minute chart, price came all the way down from the 75.00 level and reached the 74.00 level. In general AUDJPY loves the big figure (double zero) levels so we want to see how price reacts when these levels are reached.
What we saw was a bullish 3 drive pattern complete right at the 74.00 level, this level in general has an increased probability of order flow resting there because its a round number and the pattern can indicate potential price exhaustion especially since it has already moved over 100 pips from the highs.
To increase our confidence, confirmation and probability for any trade we want to locate as many factors that all line up to give you the same reason to execute. In this case once price rejected at the 74.00 level and we saw a bullish price pattern complete. The last factor we want to see is a higher inner trend line break to the upside as this can help confirm the pattern and also clearly show you a precise execution point.
As we are trading the pattern we do not have to place a stop loss too far below the 3rd drive and the 74.00 level, while we can also look target 74.50 in the short term as there is not a lot of resistance until this area.
As you can see from the 15 Minute chart, price came all the way down from the 75.00 level and reached the 74.00 level. In general AUDJPY loves the big figure (double zero) levels so we want to see how price reacts when these levels are reached.
What we saw was a bullish 3 drive pattern complete right at the 74.00 level, this level in general has an increased probability of order flow resting there because its a round number and the pattern can indicate potential price exhaustion especially since it has already moved over 100 pips from the highs.
To increase our confidence, confirmation and probability for any trade we want to locate as many factors that all line up to give you the same reason to execute. In this case once price rejected at the 74.00 level and we saw a bullish price pattern complete. The last factor we want to see is a higher inner trend line break to the upside as this can help confirm the pattern and also clearly show you a precise execution point.
As we are trading the pattern we do not have to place a stop loss too far below the 3rd drive and the 74.00 level, while we can also look target 74.50 in the short term as there is not a lot of resistance until this area.