Japanese YenHere is a market that is setup to rally but continues downward. The seasonal tendency is for a rally at this point, and the commercials are heavily long. However, as you can see by the red line drawn on the screen, we are in a strong downtrend.
I have marked a B for buy on the chart above that downtrend line. Any weekly close above this line at this point would be a signal to go long this market. Then if the trend does change to upward we can trade pattern setups along the way.
Until this trendline break, NADA. To quote Tom Petty, "the waiting is the hardest part."
1 comment:
The trend always rules the day. I did make one short trade in the YEN last week for a small gain. The ideal setup would be a rally that brought a big shift to the short side in commercial positions.
It is best to have both the trend and the insiders together in my opinion. However, over the years in general the YEN has rallied at this time of the year, so any shorts for me are going to have a very short leash.
The week of 9/9 05 is the best example of having the trend and the commercials together, and look at the drop we got.
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