USD:JPY Daily – Triangle Strategy

On 16 December, I posted a potential triangle set up for USD:JPY

In the post, I noted that 14;3 stochastic on the higher time frame weekly chart was trending higher. At the time this suggested the set up was best looked at as a potential buy.

However, this has now changed. Price broke below the triangle support and as it did so both the daily and weekly stochastics were trending down. This validates a short trade

I’ve posted a strategy on the chart below

The first profit target uses the measuring rule where the height of the triangle is deducted from the point at which price broke the triangle support line. A 30 pip filter has been added to this level

The second target is based on a Fibonacci cluster zone. This assumes the next swing down from A may be the same size as the last swing from O to X and 127% of the correction from X back to A

If the downtrend gets as far as 61.8% of the measuring target a one candle trailing stop is put in place until the stop gets to 82.16. The stop can also be moved behind any re test of the triangle support line

You can follow us on Twitter at RicCharts and Davecharts



About Ric Spooner

Over 30 years market experience - professional trader, broker, director
This entry was posted in Forex, Market, Trading. Bookmark the permalink.

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