(AUD/JPY Daily Chart 9/18)
Now, with this bullish breakout confirmation developing, let's take a look at the 4H chart. Here we see a market that is at the crossroads with price in the middle of the moving averages. The RSI has tagged 30 and it now threatening to break above 60, which would signal loss of bearish momentum.
There was a double bottom around 96.50, after which price came up to 97.50. So far, it is consolidating just above the double bottom, showing some bullish bias as it respects a price bottom.
(AUD/JPY 4H Chart 9/18)
Trade Idea, R:R assessment:
I believe in the short-term, we can put in a buy position around 97.00, let's say 97.15. If we have a stop below 97.00, ie. 96.70, we have a 45-pip risk. Our target can be first limited to the 98.10-20 area, let's say 98.15. This would yield a risk of 45 pips and a a potential reward of 100 pips, translating to a slightly better than 2:1 reward to risk ratio.
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