The past two sessions in the Japanese Yen futures have seen small ranges, with both days trading inside the big range bar from last Wednesday (April 8). The 8th was also a successful test of the low of the selloff. The two narrow days were a breakout setup; let’s see what we did with it.
The daily chart of the Yen futures has the two narrow range day bars circled; note also how it was retesting broken support at 1.0054. (I’m a believer in “round numbers” being support and/or resistance points, so in this case 1.0050 would be resistance.)
Below is the Trade or Fade report for the Yen for April 14th; the range of the previous day was the narrowest of the previous four days, giving us our breakout signal. Trade or Fade calculated its upside breakout point at R-1 resistance of 1.0066, with a first profit target at R-2 or 1.0130. (for information on Trade or Fade, and to sign up for a free trial, go here.)
The intraday chart shows today’s action. After a weak US retail sales number, the Yen rallied up just through that old support at 1.0054, then retraced a bit. The move through the intraday high of 1.0060 pushed it up through 1.0066, stopping us into a long position. Stops went under the low of the previous swing high bar, at 1.0035.Patience was rewarded as it rallied to our profit target of 1.0130 by Noon Central time, for a profit of approximately $800. Second resistance at R-2 served to cap the rally, and it traded in a sideways pattern for the remainder of the session.
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