The Chart of the Week: USD/JPY bears looking for shorts for favourable risk/reward territory
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- The USD/JPY charts are starting to ripen for shorting conditions, although there is still some development required.
- The monthly structure is critical in this analysis, but the daily chart is opening up the prospects of a trade for the days ahead.
The price is beginning to show signs that a new cycle could be emerging below a critical monthly resistance area which gives rise to the possibility of a swing trade shorting opportunity on the lower time frames.
We first need to see confirmation that the price is in bearish conditions on the lower time frames, but prior to that there is scope for some upside to come in the next days that will be giving bears a discount from a key daily structure.
The following is a top-down analysis offering two scenarios for a short position.
Monthly support turning resistance
Firstly, the monthly chart is showing that a long term important level is under pressure, setting the stage for a bearish playbook.
Weekly bearish conditions
The weekly chart is confirming bearish conditions also.
Daily shorting area
if the price were to pick up some last-minute liquidity from the structure, then this would offer an ideal set-up from the structure and improved risk to reward ratios.
Alternatively
Alternatively, if the price continues to sell off from here without any pullback to resistance structure, then bears will be keen to be short below the current support on a restest of it.
- The USD/JPY charts are starting to ripen for shorting conditions, although there is still some development required.
- The monthly structure is critical in this analysis, but the daily chart is opening up the prospects of a trade for the days ahead.
The price is beginning to show signs that a new cycle could be emerging below a critical monthly resistance area which gives rise to the possibility of a swing trade shorting opportunity on the lower time frames.
We first need to see confirmation that the price is in bearish conditions on the lower time frames, but prior to that there is scope for some upside to come in the next days that will be giving bears a discount from a key daily structure.
The following is a top-down analysis offering two scenarios for a short position.
Monthly support turning resistance
Firstly, the monthly chart is showing that a long term important level is under pressure, setting the stage for a bearish playbook.
Weekly bearish conditions
The weekly chart is confirming bearish conditions also.
Daily shorting area
if the price were to pick up some last-minute liquidity from the structure, then this would offer an ideal set-up from the structure and improved risk to reward ratios.
Alternatively
Alternatively, if the price continues to sell off from here without any pullback to resistance structure, then bears will be keen to be short below the current support on a restest of it.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.