Swing Technicals- USD/JPY Short Opportunity at 78.89

Tuesday, December 20, 2011, 6:18 PM

December 20, 2011

CURRENCYCURRENT BIASPOTENTIAL STRATEGY
EUR/USD (Medium Term)
Watch for a new opportunity that would allow us to go short near the bearish trend line.
GBP/USD (Medium Term)
Watch for a new opportunity to emerge.
USD/JPY (Medium Term)
Sell USD/JPY at 78.89. Stop at 79.26. Profit target at 78.33.
USD/CHF (Medium Term)
Watch for a new opportunity to emerge.
USD/CAD (Medium Term)
Watch for a new opportunity to go long at either bullish trend line.
AUD/USD (Medium Term)
Watch for a new opportunity that would allow us to go short near the trend line.
NZD/USD (Medium Term)
Trade has reached profit target; watch for new opportunity. Bought NZD/USD at 0.7553. Stop at 0.7533. Profit target at 0.7594.
EUR/USD (Swing Forecast)
Potential Strategy
Watch for a new opportunity that would allow us to go short near the bearish trend line.
What is the trend?Neutral
What is this pattern?No pattern present - See all chart patterns
Why is this significant?There is no high probability pattern so we cannot place a trade.
What other indicators or Fib Levels support this thesis?No trade.
Reason for Strategy
A bearish trend line has formed on the EUR/USD 2hr Chart. The trend line has there solid points of contact, so our focus will turn to finding a bearish pattern that could provide an opportunity to go short near the bearish trend line. The pair is now testing 61.8% of YZ on the Weekly Chart. Ideally, there would be a short term bounce off of 61.8% of YZ that would create a rally in an ABCD shape that completed near the bearish trend line. A lot still has to happen before that trade idea could become reality, but the pieces are in place at this point.
Trade Invalidation
No trade.
Support & Resistance Levels
Resistance 3N/AN/A
Resistance 2N/AN/A
Resistance 1Bearish trend lineSee 2hr Chart
Current Price1.3082
Support 11.304661.8% of YZ on the Weekly Chart
Support 21.2947Bullish Gartley
Support 31.253278.6% of YZ on the Weekly Chart

Daily Chart - 61.8% of YZ could still provide strong support.
2hr Chart - Bearish trend line.
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