Talking Points- USD/JPY Opens in Range
- Trend Traders Await New Breakout Opportunities
- Bearish Reversal Signaled Under 108.52
(Created using FXCM’s Marketscope 2.0 charts)
The USD/JPY has opened with traders wondering if the pair can trade towards its 7th weekly high in 7 weeks. In order to do so, the USD/JPY will need to break through today’s key values of daily resistance. Currently traders are watching the R4 camarilla pivot at 109.47. If price breaches above this value, it would be a strong signal of continued momentum with the daily trend. Traders can take advantage of a higher high by enacting the trend based strategy of their choosing.
As price has yet to breakout today, there is always a possibility of a continued range bound market or a broader reversal. For a range to develop, price should be contained under the R3 pivot at a price of 109.23. If resistance is tested, reversal traders will again look for price to move to range support found at the S3 pivot at a price of 108.79. The distance between R3 and S3 has created a 44 pip trading range for today. A broader reversal would be signaled under the S4 pivot, in which the USD/JPY would be moving towards lower lows. In either scenario the trend would be considered on pause, allowing traders to adjust their strategy accordingly.
Yesterday's Update
On Friday, NZD/USD traders were looking to take advantage of a 54 pip trading range. Price hovered near resistance at the open of the U.S. trading session at a price of .8170. By the conclusion of trading price had traversed the range three times after again moving to support at .8126. To learn more, check out Fridays FX Reversal article linked below.
-- Written by Walker England, Trading Instructor