EURJPY: Consolidation Mode Part III

FX:EURJPY   Euro / Japanese Yen
I am fully aware of the risk that sequels tend not to be as good as the original (Rocky comes to mind), but I could not resist putting this pair on my watch list again. As my last two publications on this one (see links under Related Ideas) left me with a good amount of pips, I thought I would try to cash in again. I therefore present to you the new installment in the EURJPY             series: Consolidation Mode Part III             . This pair has been ranging around the key structure kevel of 135.14 for almost 27 days. Despite the mixed Euro             data that came out this morning, price drove up 70 pips, so after breaking the key structure level to the downside last Thursday, price is now approaching it again from below.

On the technical side, we can see the contour of a bearish Bat on the hourly timeframe that completes at the mentioned structure level. Price comfortably passed the B point this morning and progressed 55% towards the potential reversal zone (PRZ). When defining the PRZ for a Bat pattern , we look at the projection of three harmonic levels. I: the 886 retracement of XA, II: an extended AB = CD pattern (in this case 1618 AB = CD) and III: a BC             expansion (in this case 2618 BC             ). This defines a clear and tight zone, about 20 pips wide, represented by the orange lines in the chart. The key structure level at 135.14 lies smack in the middle of this zone, increasing the odds on a reversal.

Should the price climb enough to test the PRZ, stabilise and reverse convincingly, I would enter short. SL goes 10 pips behind X. Normally, I look for TP1 = 382 retracement of AD and TP2 = 618 retracement of AD, but in this instance I have placed them both a little higher due to structure support levels.

There are 101 pips to be made (if this pair follows the script) and the trade has a reward – risk ratio of 3.1!

UPDATE: The pattern did not complete, so I did not enter any trade. No problem, nothing was risked and nothing was lost. On to the next trade!
You don´t need to be a weatherman to know which way the wind blows - B. Dylan
Why publish if you dont enter a trade?
-1 Reply
At the moment he published he could not possibly know that the pattern was not going to complete, right ? And since this site is all about sharing trading ideas, this was a valid one at the moment of publication.
Exchanging only trading ideas after you've entered the trade would take away the possibility for other people to enter the trade, on the other hand you could have ideas that do not work out. Hope this explains why it was published ? :)
+2 Reply
I publish trade candidates timely, not at the moment of entering when its of no use to anybody anymore. And if a pattern does not complete, I don't enter a trade. Its not so hard to understand.
+1 Reply
UPDATE: The pattern did not complete, so I did not enter any trade. No problem, nothing was risked and nothing was lost. On to the next trade!
+1 Reply
Hey Jasper, very reasonable trade to take. I just wanted to ask you that is it better to place stops couple of pips above X point or above the high of the big red candle, which is at 15 hour on Feb 24; based on the x-axis? Providing that I am willing to risk as much as you would on this trade. Thanks for sharing and Good luck!!
+1 Reply
JasperForex moneymaking
Thanks. The Bat pattern fails if price trades beyond (in this case above) the X level, so there is no need to place the stop loss yet another level higher, it would just increase your loss in case of an invalidation after you entered the trade. My current risk would be 33 pips.
+2 Reply
moneymaking JasperForex
Great, Thanks!!
+1 Reply
This looks very familiar to me ... how shameless of you to publish this ! :P
+2 Reply
JasperForex Nico.Muselle
Haha if you don't trade B´s under 50% retracement, I do as I follow Carney his rules. Thank you for pointing this one out to me in chat earlier today.
+2 Reply
Nico.Muselle JasperForex
You're very welcome my friend, by the way I'm currently trading the BAMM :)
+1 Reply
EN English
EN English (UK)
EN English (IN)
DE Deutsch
FR Français
ES Español
IT Italiano
PL Polski
TR Türkçe
RU Русский
PT Português
ID Bahasa Indonesia
MS Bahasa Melayu
TH ภาษาไทย
VI Tiếng Việt
JA 日本語
KO 한국어
ZH 简体中文
ZH 繁體中文
AR العربية
Home Stock Screener Forex Signal Finder Cryptocurrency Signal Finder Economic Calendar How It Works Chart Features House Rules Moderators Website & Broker Solutions Widgets Stock Charting Library Feature Request Blog & News FAQ Help & Wiki Twitter
Profile Profile Settings Account and Billing My Support Tickets Contact Support Ideas Published Followers Following Private Messages Chat Sign Out