#GBPUSD on 8 Dec, looking for a selling opportunity as the market was pushing through and breaking out underneath the 1.5000-level. You can see historical support along the green-shaded area, back here on the left-hand side. The last time it broke through that 1.5000-level, we took a tumble all the way down into the 1.4900-level.
So, with the push below here on the fall that we saw day before yesterday and the push below the 1.5000-level, on the rally back underneath 1.5000 was looking for some more resistance into 1.5000. At least another challenge back down here into the mid-1.4900s. Well, the market had a little bit different idea. It did hesitate for quite a long time. If I zoom it in here, you could see we had this four-hour candle. Four four-hour candles just kind of hovering just above the 1.5000-level. So, there was still some hope that we could see it take a turn back down.
Market had a little bit of a different idea and pushed through the 1.5025-level, and continued to pressure now up towards the 1.5100-level, into the 1.5090s. So, hopefully you were using appropriate risk strategies. In the case, the market didn’t do what you expected it to do or what I expected it to do, and you closed out the trade appropriate. I’m out of that trade now. Hit the stop loss. It was a 50-pip stop loss. Good news that I got out of the trade because it would’ve been further into the negative as it pressure back towards the 1.5100-level.
I would expect today we will see, again, some resistance here. 1.5100 to 1.5125 on this rally higher. We take Fibonacci from the high, down to the low. That puts the 0.7860 right here in the middle of the blue-shaded area of the most recent high, down to the current low 0.7860 right in the middle at 1.5114. So, I will expect some resistance here. We’ve seen it before. If you happened to be in a buy for whatever reason, look at the blue zone – 1.5100 to 1.5124 – as your target. If, indeed, it does continue to pressure higher and breaks through 1.5125, of course in a similar fashion, you would look for the continuation of the upside. So, if you’re in a buy for whatever reason, look at this as your first target. If you’re looking to go short on the #GBPUSD, look at this blue zone as your next opportunity.
Another trade opportunity that we talked about on 8 Dec., was the potential of selling under the yellow-shaded area, 0.7245. That market never made it all the way up to 0.7245. We saw an attempt here. It got as high as 0.7235 before turning around and going back down still having the pending trade there. If we don’t get any movement towards it today, I may go ahead and take that pending order off, if it doesn’t go back up there. And clearly a breakdown of the orange zone looks for it to go all the way back down to the blue-shaded area at the very bottom of the chart.
#USDJPY yesterday. We’re looking for buying opportunities, and it’s got fairly low risk and a good, decent risk-reward radio here for this currency pair. You could see the uptrend. We’ve been in an uptrend going all the way back here. This is the daily timeframe. Going all the way back here to mid-October. October 15, we found the low down here. We started moving up. Went into a period of congestion. Broke above that box and went up a little bit more. And now, since then, and we’re looking since November 6, so a little bit more than a month now. A little bit more than four weeks, we have been just bouncing around inside this range, this black box that you see here.
In the direction of the previous trend, the hope and expectation is that we’ll see the breakout of the trend in the direction of that trend to the upside and continue the direction of the uptrend. Now, that doesn’t have to happen. As we’ve seen before, if the market decides to go a different way and push underneath that range, we could look for some further retracement of the previous uptrend. So, this is the way we’re looking at it. We’re in a range. We need a breakout really. But while it’s inside the range, it does provide us opportunities, and we’ve had other opportunities to buy towards the bottom of the range and profitable opportunities over the past couple of weeks.
So, buying into the orange zone is the next order of business for the day today. I’m actually going to zoom it in one more time here on the daily timeframe. Look at the support we see in here, here, and here. Could that breakdown this time? Sure, there’s a good possibility or there is a possibility. Maybe not good, but there is a possibility that it breaks down and continues to go back down, retracing back down towards the 100-period moving average, 100-daily period moving average, sitting down here into the 121.00s, and that’s the green line right inside the pink-shaded area.
There is that possibility, but as history has shown us for the past four weeks, there is definitely support here and I think it bears a good shot, an opportunity here to go long into the 122.50 to 122.25-level. 122.50 to 122.25 is your zone of support here. That is the orange-shaded area. Buying and of course, first off, targeting back to the green-shaded area or even as high as the purple-shaded area become your potential targets. That’s back to 123 or 123.50 on the way back up. So, anywhere within that orange zone.
I currently have my stop loss just underneath the lowest low of the range, which is this blue candle way back here on the left-hand side. So, my stop loss down around the 122.15 level. So, if you get in at 122.55, stop loss at 122.15. You could see that’s not too terrible of a risk on the trade and the potential profit is pretty decent as it goes back up towards the mid-123s. And of course a breakout of the range, as I said, to the topside, we could even see some more profit as it continues to pressure back in the direction of the trend.
I have applied the trade manager to the trade, so we’ll look for the market to continue to pressure back up and lock in profit as we see it. Typically, I will lock in profit when I see 20 pips. Lock in break even if I see 20 pips or more. So, if we’re in at 122.55, we need it to go to 122.75 for us to get the opportunity to go break even on the trade. And then of course anything beyond that becomes profit for the trade. So, anywhere inside the orange zone, between 122.55. Actually I might call it 122.55 and 122.30. Anywhere between there, I would look for an opportunity to go long at the bottom of the range for the #USDJPY today.
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