Trade Of The Day: EURJPY Buying A Base Retest
Trade OF The Day: Market choppiness continues, as EURJPY seesaws inside the broad 129-127 range, and it looks like we will need to wait for the FOMC+BOJ policy decisions in the next couple of days to establish a new theme. For choice, prefer the pair to find support in dips especially as we anticipate the FOMC to maintain a relatively moderate tone and players to be wary of a potential move from the BOJ on Friday.
Techniclas: Anticipated grind higher to test 129, over 129.50 eases immediate bearish tone bulls target 131 next while 127.50 supports.
Trade Idea: As we head into this weeks key risk event tonight’s FOMC meeting followed by Friday’s BoJ meeting I am monitoring the EURJPY as it is setting up a classic range break and retest which could be the first leg of a broader correction or potentially a more meaningful reversal. As per the chart below I am looking for price to extend to the upside test previous structure lows before pulling back to retest the base that has been carved out during January. I will be monitoring intraday reversal patterns on a pullback to 128.50 to set longs targeting 132 initially.
For updates on trade of the day set ups and the other trades I am currently monitoring be sure to follow me on Twitter @LFXPatrick