breakout failuretrend is in transitional phase so it's hard to tell whether it's a continuation or the exhaustion point of first impulse leg
Dollaryen
$DXY, Dollar Index Roadmap after Brexit Dust Clears - July 2016Initial support is seen at 95.95 – 95.75 followed by lower support at 95.0 – 94.75.
A bullish follow through above the first support with a breakout above 96.55 which marks the bull flag’s high could signal a longer term rally that could see 97.45 followed by 98.55 levels being marked as the minimum price objective here.
The bullish view could, however, turn weaker in the event that the dollar index slides to 95.0 – 94.75 to mark a retest of the H&S and price channel breakout level. In such a scenario, US dollar will be likely struggling to breakout above 95.95 – 95.75 which could potentially turn to resistance and put the bullish view into question.
Your likes and comments are really appreciated guys, thank you for all the support and trade safely.
Thanks.
www.tradingsignalreviews.com
USDJPY on the brink of short term reversal (?)If 106 is overcome, it could be the sign of further strength as the last retracement is somewhat more aggressive than the previous attempts
RANGE BOUND - USDJPY: TRADING STRATEGY - PART 2 Trading for this week:
1. My plan for next week focuses on point "3." from the previous post - I am waiting for risk-on or risk-off assets to confirm investor conviction by using USDJPY as a barometer for net risk sentiment. Despite the market uncertainty and high volatility UJ last week traded within a 200pip range for the between 101.3-103.3. Therefore, I consider a 60pip break of either level to confirm the conviction to a sentiment e.g. 60pips higher is risk-on (Yen selling), 60pips Lower is risk-off (Yen buying).
So of the two possibilities for this week (based on the previous post) Most likely i think is:
1) Global risk continues its recovery as I ask myself what possible risks/ events are there that could tip risk-off sentiment? My answer is none. However, there are several arguments for a risk-on bias e.g. 1) Central bank easing continues to offer risk higher e.g. a dovish RBA (5th) and BOE meeting (14th) price JPY lower and UJ higher
2) Implied vol continues dropping below realised vol, aiding bullish sentiment.
3) Brexit uncertainty continues its de-risking/ pricing as its unlikelihood increases. Further, I think Equities have another week of rallying to price before earnings uncertainty selling will become a factor.
Trading Strategy:
If Yen carries on Ranging I advise buying UJ at lows of the range e.g. between 101.3-101.9 - or you could buy at any price in the range as I have a target of 106 in the near-term and 110+ in the next 4+wks.
Alternatively, I advise placing BUY STOP orders at 103.9-104.2 (level that confirms a risk-on breakout) as there will be 80% of UJ short Stop-Losses at this level, so we will likely see a short squeeze take us 200pips up instantly once UJ trades to at or about 104.
I like owning UJ structurally in the medium term as even if UJ falls lower in the near term which is unlikely (what risk is likely to drive it lower?) as UJ trading at or below 101 (and the further it falls) the more likely the BOJ will be to launch emergency FX intervention and/or near term lower UJ increases odds of an aggressive BOJ cut at its July 28th meeting - which will make UJ trade 500pips+ higher, dependent on the measures/ aggressiveness taken.
For some background/ support for the UJ higher trade
1. based on BOJ easing, recently JPY retail sales disappointed at -1.9% vs -1.6%, as did inflation which was seen at -0.4% nationally for CPI and Core and -0.5% for the same in Tokyo + BOJ's own Core measure continued its strong MoM downtrend at 0.8% (from 0.9% last) - consistently unresponsive inflation is the single biggest driver for BOJ easing/ cutting policy, and the poor inflation has been problematic since the last cut in January 2016 so this gives further weight to another cut, especially since it was 6+ months ago.
- Also BOJ Kuroda and JPY Govt Aso and Abe had several emergency meetings last week as a result of the Brexit vote/ JPY appreciation, in which they discussed FX levels, although taking no action, such rhetoric and actions imply and give likelihood that the BOJ will take substantial action in July.
- Technically, UJ has been oversold for several weeks, even if UJ higher isnt structurally long, we should at least be able to realise a 600-800pip recovery rally before moving lower again.
Volatility
- USDJPY Realised Volatility is trading higher than implied (bullish signal) with 2wk and 1mth at 19.64% & 15.6% vs implied's trading at 11.25% & 13.43% + there are some large notional OTM call strikes at 104.2 and 105, indicating the market may have a bullish bias. Also, the UJ 1wk/1m 25 Delta Risk Reversals Trade at apprx -1.6%, and falling, indicating the market is becoming more bullish by 1) being positioned long in the spot market but buying less downside option coverage and/or 2) Speculative Demand for UJ downside puts is falling.
*Read my previous post "RANGE BOUND - USDJPY: IS THIS GLOBAL RISK RECOVERY REAL? PART 1" for analysis of last week and mo
RANGE BOUND - USDJPY: IS THIS GLOBAL RISK RECOVERY REAL? PART 1Expectations vs Reality:
1. Following the referendum decision on Friday, as expected GBP sold off 10%+, the FTSE plummeted in a similar fashion and global risk assets sold off across the board, but FTSE/ Risk recovered a significant amount of those losses into Fridays close and for the rest of the next week.. So what happened to BREXIT?
- Such behaviour would lead you to believe that the Brexit decision was all just a bad dream, with much of the price action volatility confined to Friday alone - rather where I had expected the decision on Friday to start a cascade of risk-on asset selling, as the brexit backdrop provides the perfect impetus to trigger the risk-off fear for the wider global risks e.g. US Election, Global growth, China Debt - and, ofc, the Brexit Macro economic spill-over itself.
Why did we witness this Risk Recovery Paradox?
1. I think the main reason that risk managed to avoid carrying its bid bias into this week from Friday was PM David Cameron's decision early on Friday/ Monday to 1) Resign in October and 2) Refuse to sign the Article 50 which formally/ actually starts the Brexit Negotiations - the net effect is that brexit risks have been shifted into 2017 (or never) rather than present, thus providing investor confidence to buy risk at its Friday discount (why not) and take bets on a Brexit no show (illustrated by a buoyed GBP which imo should have fallen more).
- What this combination of events now means is that Brexit now trades as a function of Political possibility rather than as a certainty because 1) By resigning in Oct and refusing to start the negotiations now, it means that Brexit itself is put on hold until at least October. Further, the fact that the above is the case, the whole "Brexit" likelihood is brought into question in itself as 1) How likely is the new PM in Oct going to sign the article 50 as soon as they get into office? I think VERY unlikely, its career suicide to start such a volatile process immediately when in office so that means the Brexit Negotiations are pushed further out and likely into 2017 (66.66% chance it occurs in 2017 now from odds-checker). 2) Will Brexit go ahead at all? I think Brexit absolutely is unlikely, as the new PM wont want the economic and political uncertainty that will follow - especially as the vote didnt happen under their leadership - imo its more likely that the new PM will forgo the blame onto Previous PM Cameron and/ or call for a re-referendum or scrap the idea completely and instead offer a solution to solve the "leave" voters problems e.g. Bid to fix EU immigration.
2. Worldwide Central Banks supportive/ Dovish statements - All Major CB have offered their support if their economy calls for it as a result of Brexit - namely the front-end of the FOMC's rate hike curve was severely flattened (Dec or 2017 hike now likely) and the BOE Gov Carney put 250bn in QE and 25bps of Int rate cuts on the cards - the net effect of these actions has been to smooth investor fear, and allow risk to rally, as low rates and QE has no doubt been the biggest driver for stocks in the last 8 years - the FTSE's recovery was/ is 100% underpinned by the BOE stance imo.
3. And the most interesting possibility is that - Investors don't believe in this risk-rally, instead it is just a micro unfolding that will eventually unravel, forcing risk to sell-off in the near future. And by looking at the stability of Gold, Bonds and Yen, this argument does carry alot of weight and is something ive been watching all week. All risk-off assets have traded flat/ higher, despite risk rallying - when risk-on and risk-off assets FAIL to maintain their negative correlation (as they are failing to do now, and are actually slightly positively correlated as they both rise) it usually means the rally is being undermined by a longer-term macro view - since liquidity is a 0 sum game in the long run, all assets cant grow at the same time, either risk must sell-off or
$USDJPY looking for possible continued weaknessLooking at prior history (left) on this Weekly chart you can see that we're at an important area here. We can see that the Bat completed, but failed to even break to a full 27.2% retrace. We then continued on down to fully complete the H&S pattern (& 200% ext); yet again, failed to retrace even 27.2% before a low NFP pushed it back down to retest prior lows area. There's a lot going on in the smaller TF's but in the bigger picture it's showing me that it's a good possibility that we finally go for that potential Alt Bat I've had on here at ~$102.505. Will it be a straight line? Doubtful. I do not see +Div anywhere yet though.
I'll break down a lower TF or two soon to show some possible paths that I'm planning for, keeping in mind that the large red candles have been tending to bounce for a little bit afterwards (neckline break one of the few exceptions). So I wouldn't say close your eyes & short anywhere, but shorting on pops looks like a good base strategy here. I'll be watching for a new June low to confirm first (smaller TF possibility for bullish move that I will prepare for if it shows promise, will to be wrong to be right). Stay nimble, especially with FOMC upon us.
Last test for Yen before reversal/breakoutDollar Yen has break the rising trend line yesterday but being false break. Now price testing another falling trend line which could possible be the last test for price before a reversal setup or breakout signal formed.
If the price could make a breakout, we Long after pullback from breakout, upside target 111.90
If the price being rejected by the falling trend line, we Short Yen, downside target 107.70
USDJPY 4/12/2016Watch the lines because it is important to know which line rejected it and which line saved it. The price of the asset merely bounces between lines. USDJPY might have a bounce, given that it was recently saved by that black line, but get ready to go short again as soon as it starts to break down at that black line.
USDJPY Making Plans To Leave Descending ChannelUSDJPY has formed and been trading within this descending channel over the last couple of weeks. After a failed retest of the 114.00 levels, it looks as if USDJPY is on it's way down. Prepare for a retest of the lows at 110.667, as well as a potential bearish break out. Market expected to head toward 110.00, 105.00, and eventually 101.00
Wolfe Wolfe Wolfe $USDJPY Wolfe Wave and GeoHello Traders,
We have 3 Wolfe Wave's here that I want to take a look at.
1. The first Wolfe Wave on the left completed in late 2014 at the 1-4 target line.
2. While the first Wolfe Wave was carving its path to the 1-4 line. A second Wolfe Wave formed. Here we created a 5" structure with the Geo's Off-Set Rule #3 at point 3.
3. The final Wolfe Wave was formed as usdjpy started to decline. Again it formed a 5" structure so we look at Geo's Off-Set Rule #3 at point 3.
From here there are two ways it can go. It can go to point 3 of the final Wolfe Wave or create newer lows and reach point 3 of the second Wolfe Wave.
-Chartistry
Usd/Jpy Weekly AnaylsisUSD/JPY Weekly outlook, we have a couple reasons to think this is a bullish retracement.
Returning into the weekly drop.
Something to look at.
USDJPY potential break of weekly/monthly Support/DemandHere we have some very simple USDJPY analysis.
I have a bearish bias on this pair however due to price sitting at around support currently I have provided a long scenario target.
As we can see from the analysis USDJPY has successfully broken below what was a Major Monthly Ascending Trendline. The short term trend is also bearish on this pair. Taking all this into consideration my bias is to the short side in the medium to long term, with targets sat at around the 110.00 level. Price has not sat at 110.00 for nearly 15 months. The 110.00 Level also lines up perfectly with a monthly Fib extension which adds additional confluence.
In an ideal world I would like to see a clean break and close at or below 115.50 and for price to then retrace back into 116.00 to 116.30 level before looking for bearish confirmation and initiating a short order.
Remember I take an Instituional Swing Investment approach so this scenario might take a few weeks to play out and may not be a suitable for day trading or scalping for that matter. But if it does play out as derscribed above then we could well see price drop a significant amount. These are the kind of trades that interest me. If it plays out as described it also means that this type of trade is based on sound money and risk management because the Risk Reward ratio will be excellent.
My only concern with this pair is that we have not had a retest of the monthly ascending trendline. However, as you all know well... Forex isn't quite so simple and the charts dont always give us what we want and can sometimes just continue dropping or rising at their own leisure. In all scenarios, I recommend remembering that the markets can continue to remain irrational longer than our accounts can stay afloat. So trade wisely and I wish you all a happy trading week ahead.
If anyone would like to comment or post their own view then please feel free to do so.
Many thanks and Best regards!
Barry The Forex Trader
#BTFXT
USDJPY: UpdateSimilarly to GBPJPY, USDJPY seems to have topped after moving past the vix spike 75% retrace support level.
On the daily chart we can observe bearish rgmov signals and on the weekly we can see that price has gone under 123, and failed to produce new highs after testing a quarterly range expansion bar's 50% level.
It seems like this is the start of a strong bear market in this pair, so I'll be looking to go short on a retracement.
Invalidation/stop is a retrace past the 61.8 level of the first wave down, which I think will be over the weekly mode.
(I'm not positive is wave 1 down is finished, probably soon).
Again, going short here once we get the aforementioned retracment, is a very significant opportunity, which I don't intend in missing.
Good luck, and brace yourselves...wild ride coming.
Ivan.
usdjpy daily long expecting some buying pressure at 122.00 psychophysical level. break retest continuation patten/Resistance became support. Also in confluence with he 0.382 fib level. Long term target still the same at 130.000
USDJPY Bearish Gartley completes around 119.70-80 on H4 ChartThis is another chart based on harmonics on USDJPY H4.
This is a Gartley which will completes around 119.70.80 area which indicates, this pair may have a fall / reversal from this PRZ (Price Reversal Zone).
As par this chart, we may have a short trade on this pair from 119.70-80 area where we can stop at 121 even. We may let this target open to suit our targeted profit or take periodical TP or even we can take profit around 118.20 (50% fib).
So lets see how we can trade with our views and ideas.
Enjoy the last moment of this weekend.
USDJPY. Is that a breakout? or fallback?USD/JPY started the last week breaking below a descending triangle, but was not able to extend lower. Instead it continued to consolidate, and surged after the NFP report.
In this chat we can see that the market is on the upper Trendline of a triangle which is now in a challenging situation. If this dynamic resistant zone break successfully, it will expose the horizontal trendline resistant which is at 120.80 area as well as the last years high 121.80 (~). At the same chart, we drew 2 EMA which are 55 Days EMA (Red one) and 200 Days EMA (Blue one) which are well below the market. This is also indicating a bullish bias in this currency pair.
On the other hand. If the triangle trendline resistant can't be broken, it will fall to nearest support zone to 118.xx or less depending on how BOJ reacts with these sort of challenge this week.
In Lower TF: In 4 Hour Time frame, I can see a Bearish Gartley is formatting which may complete around 119.70-80 area. (uploading the image in the comment section). We can hope this market may not get further up than this point. (Which is also a medium level resistant area).
Nevertheless, I'm expecting some sort of retracement before the breakout happens to the upper side. We may even see a gap opening (in lower TF).
USDJPY Looking Toppish on Weekly ChartThe USDJPY is presenting a short setup as seen in this weekly chart where the RSI and Stochastics are both rolling over from overbought levels. The MACD blue line is also flattening, with the MACD histogram finally falling for the first time this week in its current rally. Equally importantly is how the USDJPY has just been rejected at the ascending wedge resistance line drawn in this chart. A first key downside target would be the roughly 104-104.5 range as projected by the ascending wedge support line. Feel free to visit stks.co for today's technical analysis on $GC_F, $SI_F, $USDX, $EURUSD, $USDJPY, $GBPUSD, $NG_F, $CT_F, $ZC_F, $ZW_F, $SB_F, $KC_F.
Website: tradablepatterns.com
FB: facebook.com
Stocktwits: stocktwits.com
Twitter: twitter.com
Linkedin: www.linkedin.com
YouTube: www.youtube.com
Google+: google.com
Email: info@tradablepatterns.com
