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by The MoleAugust 30, 2011

FX traders rejoice – I’m seeing a very promising setup in the USD/JPY right now.

This one almost got away – fortunately it showed us professional courtesy and waited around long enough to afford us a good entry at a defensible position.
[amprotect=nonmember] Charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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Technically we appear to be sitting on support here. Note how we have hovered above several clustered sell net-lines for the past few sessions. Also direct your attention to the hourly panel on the left where we are showing two support clusters. The weaker of the them is S1 representing the lower 25-hour BB line. The one that seems to line up nicely however is the lower 100-hour BB which currently coincides with those NLSLs on the daily.

I would feel better after a retest of the current daily NLSL but there are never any guarantees and  I think we are close enough to justify an entry which can be easily protected by setting a stop below the hourly BB (or daily NLSL).

Caveat: Watch your charts and keep a tight stop – if we drop through support it’s quite possible that we accelerate lower.

Target: A bit tricky as the 25-day SMA is right above and needs to be overcome. Obviously we would not want to take profits that close by, so we may churn around a bit before we pop higher (assuming of course we do). All that said I think 78.5 should be good for T1 and 79.5 for T2.

UPDATE – looks like Scott just put something up – so please make sure to check out his most excellent post.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at the usual social media waterholes.
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