Would you short the USDJPY even with BOJ interventions?
I wouldn’t go short on the USDJPY, and you know why, there is always the possibility to get caught during a BOJ intervention, and if you use tight stop loss order as I do, you are going to get caught…
So, my plan for the USDJPY is to wait for it to be in a bullish market condition. When would this be? Take a look at the next chart:
- If it breaks the bottom of the range (lower green level) it will be trading in a bearish condition, but I wouldn’t do anything here because of a possible BOJ intervention, so I’ll be on the sidelines if this happens.
- If, on the other side, it breaks the top of the range (upper green level) it will be trading in a bullish condition and long opportunities will be in play, and of course I’ll look to enter here. What happens if the BOJ intervenes? It will be on my direction, it will actually help my trade reach faster my take profit order.
Remember though, we need to wait for the USDJPY to break the top of the range before looking for any trade opportunity.
Follow me on Facebook