USD/JPY Daily Support Zone in Play
Direct from the desk of Dane Williams.
Monday morning in Asia, forex markets are back open and I'm back at the desk ready to crush another week.
During my weekly market prep, I'm simply scanning through my watchlist on MT4 and looking for markets that are trading around key daily support/resistance zones. I only want to be doing business where markets are the most efficient (and hopefully rational), which makes looking for these high volume zones key.
One such market that piqued my interest, was USD/JPY. The last time price was at the daily support zone we'll talk about further below, USD/JPY buyers went stop hunting, pushed price through the zone and subsequently soaked up the juicy liquidity before sending price higher.
Take a look at today's USD/JPY daily chart below.
USD/JPY Daily:
You can see the stop hunt pretty clearly as price wicked down below the zone, only to ping up and close as a huge bullish candle. From there, price has now price wicked into the zone again, found buyers and pinged higher.
The most recent of these is what I wanted to talk about here, shown perfectly on the intraday, hourly chart below.
USD/JPY Hourly:
You can see on the most recent push into daily support, the zone held, before making an intraday higher low. We want the higher time frame and intraday charts to all be telling us the same thing, and with price holding higher time frame support and printing a higher low on the intraday chart, this is what we've got.
In terms of how we can trade this particular USD/JPY long setup, you can see I've marked the first short term area of resistance that when retested as support, can be used to manage our risk around. From here we apply the same principles that we talked about last week on that GBP/JPY aggressive short.
Let's see how this one plays out. Manage your risk, stay safe out there this week and as always...
Best of probabilities to you!
Dane.
FOREX BROKR | Hive Blog Higher time frame market analysis.
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