First, I'm not any kind of guru or master or anything like that. I'm just a successful trader in my own right and i have my own ways of doing things. But the reason I post on this site is to share my knowledge and hopefully help some people. Whether you agree or not with me, it does not matter. These are my ways of doing things and my techniques which have worked very well for me over the many years I've been trading.
Why the rush to "catch a falling knife" here? If you jump in on a BUY now, that is what you will be doing! I've already suffered 2 losses doing exactly that so I am not immune to making that mistake. But the 2 trades I did execute and lost on were based on good setups and wave counts which turned out to be wrong! Yes, that's right. I can be wrong! So can anybody. That does not make my techniques or other trader's techniques to e ineffective.
So back to this pair. According to my current wave labeling which current price action is more and more proving to be correct, this current down trend could be a wave (A) of a wave 4 correction. And this is on a DAILY TF. So of course, that means moves can be quite large. Following my wave count that this can be a wave (A), then there is no way to tell when this wave will end and how long (far?) it will it go! Yes, I know that many technical indicators are SCREAMING OVERSOLD! OVERSOLD! But so what? This does not mean anything to the market! For example, the I use is very much oversold. But I do not rely on the to tell me when to take a trade. It can remain oversold for a long time while prices keep moving down. It is only telling me that at some point (don't know when) prices will reverse. This goes the same for divergence. I see so many traders spotting divergence in whatever indicator they use and suddenly want to jump into a trade because of it. Divergence DOES NOT tell you when to take a trade! it only indicates that there will be a change in the direction of the price action sometime coming. It WILL NOT tell you when. It could be hours, days or even weeks before it happens!
Yes, there are many indications for a BUY but should you? I've always been a big believer in using price action as the ultimate indicator. It is the trigger for my trades. Not patterns. Not . Not divergence. Not wave counts. Price action. And right now, I do not see any price action to tell me to enter a LONG trade.
If you are wanting to enter a LONG trade here. tell me...what is your trading plan? where do your stops go? Remember, stops should not be based on what you can afford to lose! Stops should be based on where on the chart would prices go to that will invalidate the reason for your entering the trade! If it's a pattern you used to enter a trade, then your stops need to go to the point where that pattern is no longer valid. If it's a wave count, then it needs to go where if prices move to, your wave count would be wrong. If it's a structure trade, then your stops need to go below the lowest/highesst point of that structure zone/area. You get the idea.
In this case, I would not see anywhere on the chart where it would make any sense to have a stop. Therefore, you do not have that crucial part of your trading plan. Without a COMPLETE trading plan BEFORE you execute a trade, you are just gambling. Not trading.
CONTINUED IN COMMENTS SECTION BELOW.....
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If I saw that kind of bullish PA happening, THEN at least I would have a valid place to place my stops and develop my trading plan. That kind of PA would also lead to some sort of pattern possibility as well as a place for me to start building a possible wave count to go on. But as of right now, there is NOTHING to be able to do that with yet.
I hope that the necessity of having a trading plan with stops, reasons for entry and TP's are now very clear to you. NEVER go into a trade without one!
We always want to catch 'that knife' don't we as emotive things.
The dollar basket, oil and the stock market will be key to this, all inter-linked and no need to rush in. If this is a short-squeeze on stocks (massive pressure from moving averages above), an oil bounce before the 'big drop' coupled with dollar rebound, then this is only going one way (along with AUD as well). Buy the 1st pull-back.