Key Levels:
Resistance Zone: Identify a strong resistance level where price shows repeated rejection (e.g., Fibonacci retracement level, previous swing high).
Support Zone: Ensure the 200-pip target aligns with a significant support zone or pivot area.
Indicators:
RSI/Overbought: Look for RSI divergence near overbought levels (>70).
Trend Indicators: Check moving averages (e.g., 50 EMA and 200 EMA crossover) to confirm a bearish bias.
Chart Patterns: Patterns like double tops, head & shoulders, or a trendline break may provide confirmation.
Example Setup:
Entry: Near a resistance zone at 158.50 (example level).
Stop Loss: 50 pips above at 159.00.
Take Profit: Near 156.50 (200-pip range).
2. Fundamental Factors
Monitor:
JPY Fundamentals: Look at Japanese monetary policy or interventions from the Bank of Japan, as they often impact JPY pairs.
EUR Sentiment: Analyze ECB statements, European economic data, or geopolitical news that could weaken the euro.
Risk Management
With a 1:4 risk/reward ratio, this setup is attractive if it aligns with broader trends.
Use position sizing to limit exposure to 1-2% of your trading capital per trade.
Resistance Zone: Identify a strong resistance level where price shows repeated rejection (e.g., Fibonacci retracement level, previous swing high).
Support Zone: Ensure the 200-pip target aligns with a significant support zone or pivot area.
Indicators:
RSI/Overbought: Look for RSI divergence near overbought levels (>70).
Trend Indicators: Check moving averages (e.g., 50 EMA and 200 EMA crossover) to confirm a bearish bias.
Chart Patterns: Patterns like double tops, head & shoulders, or a trendline break may provide confirmation.
Example Setup:
Entry: Near a resistance zone at 158.50 (example level).
Stop Loss: 50 pips above at 159.00.
Take Profit: Near 156.50 (200-pip range).
2. Fundamental Factors
Monitor:
JPY Fundamentals: Look at Japanese monetary policy or interventions from the Bank of Japan, as they often impact JPY pairs.
EUR Sentiment: Analyze ECB statements, European economic data, or geopolitical news that could weaken the euro.
Risk Management
With a 1:4 risk/reward ratio, this setup is attractive if it aligns with broader trends.
Use position sizing to limit exposure to 1-2% of your trading capital per trade.
Trade closed: stop reached
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.