USDJPY Big Picture - Breakout Pressure Building
The YEN is currently the most bearish held position against an otherwise weak USD (Net Speculators currently 78.4% bearish). 14 period Standard Deviation of Open Interest suggests there is room for more short Yen positions to be added. Open Interest has been building within this significant monthly triangle (shown here on weekly chart) suggesting building steam for a possible breakout.
I am looking to get long on the side of sentiment as the current trendline (purple) seems to be holding to be prepared for a potential long breakout. I will open half my risk here on LTF, and prepare for another long entry around 112 if the purple trendline breaks and retests bottom of current range.
Long will be strongly tested at confluence of blue support levels and monthly upper trendline (black). I'll be adding a short hedge at this level as I expect some bounce or even perhaps more range trading in the blue triangle. On bounce at 113.6-114 zone both long entry and hedge entry Stop Losses will be moved to BE to be safely positioned for movement in either direction.
All published ideas are for educational and informational purposes only. Note specific entry ideas posted here may be part of a larger position and/or portfolio held by the author. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
I am looking to get long on the side of sentiment as the current trendline (purple) seems to be holding to be prepared for a potential long breakout. I will open half my risk here on LTF, and prepare for another long entry around 112 if the purple trendline breaks and retests bottom of current range.
Long will be strongly tested at confluence of blue support levels and monthly upper trendline (black). I'll be adding a short hedge at this level as I expect some bounce or even perhaps more range trading in the blue triangle. On bounce at 113.6-114 zone both long entry and hedge entry Stop Losses will be moved to BE to be safely positioned for movement in either direction.
All published ideas are for educational and informational purposes only. Note specific entry ideas posted here may be part of a larger position and/or portfolio held by the author. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.