Japanese Yen - a Profit Opportunity Right Now
Yesterday we gave you a set up in the Dollar Yen, which has come to fruition with the dollar turning up against the Yen, and its already in profit - Where will prices go from here?
Lets take a look.
Yen
We already have a banked profit on the yen and 2 on the B Pound using this method, which uses support and resistance, stochastics and Bollinger bands and thats it.
We are using the free chart service futuresource.com
The trade
We noted the trend in the yen is down and that it was testing the key support in the dollar at 11400.
This level is firm in the short term and we think it is unlikely to give way.
Prices double bottomed above this level providing near term support.
To time entry
We simply used the stochastic (the best timing indicator and this is outlined in our other articles) its an under used indicator by forex traders but is simply the best timing indicator you can use.
To indicate that the dollar up trend was resuming we simply waited for momentum to turn up.
We therefore watched the stochastic lines turn up with bullish divergence and then we went long.
This trade is already in profit, but looks like it has further to run.
The 11800 level is first target.
If this level gives way then the Dollar should get back above 12000.
Momentum should pick up if the middle Bollinger band gives way.
The yen can be a very choppy currency to trade at times but so long as remain above 11400 the odds favorthe dollar pulls.
The trend in the yen is down
Interest rate differentials are massively in favour of the dollar and it is unlikely the yen could break up unless we see a meltdown in US stocks.
A simple way to trade
Take a look at trading into support and resistance and using stochastics to time and Bollinger bands to show targets and you will be surprised at how effective this system is.
We have done 3 live trades and explained the logic of using this method of trading and made profits on all of them.
This is our 4th and we would expect a profit if we don't get one then the risk is small.
Related Tags: forex trading, forex trading strategy, forex trading method, japanese yen
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