Technical Analysis USD/JPY

New Home Sales: yen retracement anticipation

Good afternoon, dear traders. Today at 16:00 CET the US Census Bureau publishes New Home Sales, data on the number of new housing sold per 1 family over the past month in the United States. The indicator is calculated annually. It is considered to be the leading indicator of economic development, as it has a multiplicative effect on various economic sectors: mortgages, insurance contributions, furniture, electronics, etc. We suppose that major investors would react to macroeconomic data, and that allows us to count on an additional volatility momentum of the US dollar against other liquid currencies. 

Today we consider the H4 chart of the USD/JPY currency pair. At the moment the price is moving within the H4 downtrend channel: we can observe a retracement within the intraday trend. The trend is confirmed by the Donchian Channel(13) bias and Parabolic values, which move along the trend line. There is no contradiction on the part of the RSI-Bars oscillator: the signal came out of the growing channel area and broke the support line in the direction towards the red zone. We expect the price retracement completion at the same time with the fractal resistance breach at 108.443. This mark can be used to place a pending sell order. There is a high probability that the movement would correspond to the resistance breach of the oscillator at 44.196%. The initial Stop Loss can be placed at 108.987, this mark is intensified by the H4 trend line intersection and Parabolic historical values.

After position opening, Trailing Stop is to be moved after the Parabolic values, near the next fractal peak. Updating is enough to be done every day after the formation of 5 new H4 candlesticks, needed for the Bill Williams fractal formation. Thus, we are changing the probable profit/loss ratio to the breakeven point.