Commentary on the USD/JPY

Forexmentor.com Forex Trading Price Action

I continue to beat the USD/JPY drum, thanks to Chris Classen, who first brought this pair to our attention, and I continue to preach the mantra ‘Sell the rallies in this downtrending market.’ Keep your eyes on the 200 EMA on the lower-level charts (hourly, 15 minute), and look for overbought situations. That strategy has proven to be quite effective, and profitable, since I started beating this drum this week.

‘Overboughtness’ can easily be detected by looking at price in relation to the 200 EMA, and/or observing the attitude of an oscillator (say, Williams %R, for example). Once a currency pair develops a trend (in this case, down), the rest remains quite easy – just play the trend, and don’t fight it. Price action on the daily chart Is below the 30 EMA, and MACD is below the waterline – and below its trigger line, with good angle and separation. Translation: Watch out below!

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