The USDJPY is trading at a critical level – almost a buy again

USDJPY

You’ve seen how the USDJPY has been trading in the last few months, it’s been going up and up and up without looking back.

Since February though, it reached an important resistance level (read it “zone”), and its been ranging since then.

Let me show you the 4H chart:

USDJPY 4H Chart

Since the first days of February, when the USDJPY reached this resistance level at 93.80, it started to trade in that range (green levels), has been difficult to break either extreme of the range.

But we cant expect the USDJPY to trade in between these two levels for ever right?

So again, why is it at a critical level?

Take a look at the hourly chart (zoomed out to see the importance of the level):

USDJPY 1H chart

Now you see what I’m talking about right?

It is trading just above 94.35, which is the critical level I’m taking about. If the USDJPY keeps trading above this level, I’d consider opening a long trade, without a doubt.

Take profit level

No analysis is complete until we know where to take profits (or when to stop looking for long opportunities).

In this case, I’ll use the weekly chart to determine my next LT resistance level:

USDJPY weekly chart

Clearly the next LT resistance level is just below the 100 mark, at 99.10.

So this is my trading plan for the USDJPY:

If the USDJPY keeps trading above 94.35 I will look for my entry in the short term charts, and will keep looking for long opportunities until it reaches the next LT resistance level which is at 99.10.

All TP orders will be set below 99.10

Your turn

What do you think about the USDJPY?

What other pairs are you currently monitoring? Any open trades?

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Raul Lopez

I've been trading the markets for more than 15 years. I believe the best way to trade is by adapting to the market conditions. You can learn it too, join our community .

  • KevinFinnity

    Interesting Raul and bold. I have been looking at this and have been anticipating a dropout into a down trend. How would you satisfy yourself in the shorter charts that an move up is confirmed and how would you use those charts to find an entry point can I ask? 

    • Raul Lopez

      Hey Kevin,

      Sorry for the late response, for some reason I didnt receive the alert about your comment… 

      I doesnt really matter what type of entry you use, as long as you are in the right side of the market (looking for long opportunities in this case)… But I use price action, please take a look at my articles and you’ll find plenty of information about my entry system:

      http://www.protradingnow.com/articles/

      Thanks for your comment!