Analyzing the Potential for an Upward Surge in USD/JPY
Updated
USD/JPY has been on a consistent upward trend for several months now, showing no signs of slowing down. In October 2022, we witnessed the pair go through a significant upward surge, gaining more than 5% in just over two weeks. Such a rapid increase is noteworthy in the currency market. However, this bullish momentum was abruptly halted due to the intervention of the Bank of Japan in the market, causing a sharp reversal.
It's worth noting that we might be on the brink of a similar phase in this market, with the potential for another upward surge. As we approach the all-time high (ATH) levels, we've only heard a few comments from the Bank of Japan hinting at tightening its loose monetary policies. While this trade idea holds promise, it should be approached with caution and considered a high-risk trade.
The forex market is notorious for external interventions and volatility, making it challenging to predict. Nevertheless, where there's a risk, there's also the potential for reward if executed correctly. Here's my game plan:
1. Entry Condition: The idea will remain valid as long as the price does not drop below 147.4. This threshold is chosen to consider potential market volatility, especially in light of important economic data expected this week.
2. Best Case Scenario: Ideally, we would like to see a gradual price movement towards the resistance level at 147.95. If there is a sudden and dramatic breakout, the same scenario would apply, but it’s essential to adjust the position size to manage the new risk appropriately.
3. Consolidation: If the price consolidates, the trade remains active as long as price swings do not breach 147.80. Consolidation periods can sometimes lead to significant price movements, so monitoring this level is crucial.
4. Entry Point: Once the price shows significant momentum by moving through the 148 level without an immediate selloff, consider entering the position. This momentum can indicate potential upward strength.
5. Stop Loss: Set a stop-loss level at 147.53. This level should be chosen carefully to limit potential losses while allowing for minor price fluctuations.
6. Target 1: The initial target is set at the 148.60 area, which corresponds to a historic resistance level from 2022. This level is chosen as it represents a potential area where the price might encounter resistance.
This trade involves a combination of fundamental and technical analysis. If you’re interested in delving deeper into this trading approach, be sure to explore more of my content for in-depth insights and strategies.
It's worth noting that we might be on the brink of a similar phase in this market, with the potential for another upward surge. As we approach the all-time high (ATH) levels, we've only heard a few comments from the Bank of Japan hinting at tightening its loose monetary policies. While this trade idea holds promise, it should be approached with caution and considered a high-risk trade.
The forex market is notorious for external interventions and volatility, making it challenging to predict. Nevertheless, where there's a risk, there's also the potential for reward if executed correctly. Here's my game plan:
1. Entry Condition: The idea will remain valid as long as the price does not drop below 147.4. This threshold is chosen to consider potential market volatility, especially in light of important economic data expected this week.
2. Best Case Scenario: Ideally, we would like to see a gradual price movement towards the resistance level at 147.95. If there is a sudden and dramatic breakout, the same scenario would apply, but it’s essential to adjust the position size to manage the new risk appropriately.
3. Consolidation: If the price consolidates, the trade remains active as long as price swings do not breach 147.80. Consolidation periods can sometimes lead to significant price movements, so monitoring this level is crucial.
4. Entry Point: Once the price shows significant momentum by moving through the 148 level without an immediate selloff, consider entering the position. This momentum can indicate potential upward strength.
5. Stop Loss: Set a stop-loss level at 147.53. This level should be chosen carefully to limit potential losses while allowing for minor price fluctuations.
6. Target 1: The initial target is set at the 148.60 area, which corresponds to a historic resistance level from 2022. This level is chosen as it represents a potential area where the price might encounter resistance.
This trade involves a combination of fundamental and technical analysis. If you’re interested in delving deeper into this trading approach, be sure to explore more of my content for in-depth insights and strategies.
Note
This Trade idea are still valid as long as we hold above the 147.4 markNote
The idea still valid with JPY not moving under 147.4Note
Idea still good, will start looking at entries nowTrade active
I longed this at 147.855Note
Adjusted my stops
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