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    CADJPY – Explosive Yes, But In Wrong Direction

    By Eliseo Agas | July 21, 2007

    Wow, what a day for JPY crosses on Friday. This makes the second strong sell-off within two-weeks for these pairs that I got the pleasure of taking it on the chin. I’m a glutton for punishment I guess. CADJPY made its move all right…too bad it was in the opposite direction.

    I got out almost immediately at roughly the 116.10 area seeing that technical levels I watch on the 4-hr chart were being violated to the downside. Technically speaking there was no reason to question the upside direction/momentum of these pairs when I first posted on this idea so I’m fine with the long play I had. Nevertheless “stuff” happens and moves like Friday are far from predictable…unless you’re psychic.

    Anyway, as the rout of these pairs began to pick up steam I was able to short USDJPY in the 121.50 area for similar reasons…technical levels were starting to be violated to the downside on the 4-hr as well as Daily charts. Fortunately, it ended the day decently in the money but the damage was done and Friday was more of a “damage control” day of trading for me. Once the dust settled, I was happy to see that my money management rules did its job and set me up for a relatively easy come back in the days to come. Remember, days like today even if you’re caught on the wrong side should not create insurmountable losses in the near-term.

    For your reference here is the USDJPY chart showing how relatively weak it has been the past couple of weeks…the sell off from yesterday just helped things move along further to the downside. Going into the new week, I’d like to see a break below the 120.70 area. If this happens then the 120 figure is an open target.

    usdjpy-0720.gif


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    Topics: What To Look At In The Market | 1 Comment »

    One Response to “CADJPY – Explosive Yes, But In Wrong Direction”

    1. Forex Trading » Forex Trading July 21, 2007 10:53 am Says:
      July 21st, 2007 at 9:56 am

      [...] CADJPY – Explosive Yes, But In Wrong Direction Fortunately, it ended the day decently in the money but the damage was done and Friday was more of a ?damage control? day of trading for me. Once the dust settled, I was happy to see that my money management rules did its job and set me … [...]

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