Usually once markets stop going up they retrace with a reasonable degree of dispatch. Last week’s impressive rally saw USD/JPY rally from 92.75 to 98.75 but price pullback has been weak, barely 25% of the week rally. The pullback had mainly bouncing around th 97.00 level. Two factors are attributed for the weak pullback. One could be Japanese investors are still paring back their long-JPY spec positions. The second could be the notion that the BOJ is quietly supporting USD/JPY in ’stealthy” fashion, a notion raised by a large German bank last week.
.USDJPY touched once again the double zero level at 97 at
I ignored the first buy signal at 0:06 GMT (the first blue triangle) since the prices had only bounced from the 97.0 and moved above the opening price of Japanese Bank trading hours. I waited for a pull back that happened at the second blue triangle with a buy signal entry. The target is for 97.20 level (20 pips bounced from double zero) or at 200 ema. Exited my position at 97.25 for a profit of 15 pips.
During the pullback there is no confirmed short position. At the third triangle, there is a buy signal with a test of the previous swing high at 97.26. Prices went sideway for a few candles and I quit my position with a profit of 1 pips. The fourth triangle was a sell signal but I ignored it unless it take out the last swing low at 97.13 or it went below the 60 ema. It did cross the ema but the next candle is a white candle thereby making the candle and the two previous candles a morning star, a market reversal.
At the fifth triangle, I entered long with a buy signal. Target will be at 50 pips above the 97.00 level. I exited the market at 97.45 for a profit of 20 pips. Therefore total profit for the Asian session is 35 pips.
