FX:USDJPY   U.S. Dollar/Japanese Yen
As you could see as we have dropped down to the 4 Hour time frame it has become more clear. If price breaks and closes above the red management level then we can see price retesting the resistance on the daily range and the downward trend line . The 200 EMA is also acting as magnetic resistance around this level. We then can look for a short setup from this level; PA must be confirmed with analysis.
However, if price remains below the red management level and demonstrates bearish PA on the 1-hour time frame then we would look short to our daily range support level . We then have to Re-analyse at this level to distinguish if price is going to break through the support or retrace then continue to the downside or form a possible harmonic pattern . Therefore, we would have real risk and money management on this trade. For those of you trading directly off the 4-hout chart stop losses should be 10-20 pips above the 200 EMA .
If the Harmonic pattern does form; we would not be trading the formation of the harmonic we would be waiting for the completion so we can look for the sell. As seen on the chart a breakout and close below the daily gives us the next target of 117.250. Then a breakout and close below this level would lead to our potential weekly target and so on. Therefore, we looking short on this time frame but awaiting the PA confirmation which can be done on the 1-Hour time frame.
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