4/12/20 AUDJPY flying high now??
Here is another Forex Trading Snack.
A Friend on twitter said it like this. “With everything the FED has done plus the fiscal stimulus package one would think that markets will stabilize first, then soar.” Bellehos
I agree, In stead we hit a bottom and started in a V shape Stock market recovery. The reason IMO as well as many others is leverage. It is an opinion built of the belief that the global economy is / was / and indeed still may be massively leveraged to some degree. So in my view all of this shapes my bias to be very bearish on stocks.
This also leaves me looking at currencies that move in tune with the risk on / risk off stock market movements. One such currency is AUDJPY.
At the bottom of my chart you can see a inverted head & shoulders pattern ( indicated in pink ) along with a divergent RSI reading. This pattern compleat At a down sloping channel top trend line by breaking past it, then retesting it, before moving much higher along with similar moves in the stock market.
Currently it’s very close to its 61.8 FIB retracement, the same with stocks as in the S&P 500. AUDJPY also in recent days has shown signs of slowing momentum, and again RSI is diverging. With price action well above the 21 SMA and the 21 is well above the 89 SMA, simply makes my case for at least a pull back in the making—or something much bigger.
My trade plan is to take small shots at going short as this pair makes new highs, with a over all target to going short if or when it tests the big figure of 70.
All the best in your trades. Trade your plan and plan your trades accordingly to your risk tolerances. This is not trade advice, but presented as a form of how I look at the markets and thus should be used as educational materials.
In FX trading you either make dust or you eat dust. All the best.
A Friend on twitter said it like this. “With everything the FED has done plus the fiscal stimulus package one would think that markets will stabilize first, then soar.” Bellehos
I agree, In stead we hit a bottom and started in a V shape Stock market recovery. The reason IMO as well as many others is leverage. It is an opinion built of the belief that the global economy is / was / and indeed still may be massively leveraged to some degree. So in my view all of this shapes my bias to be very bearish on stocks.
This also leaves me looking at currencies that move in tune with the risk on / risk off stock market movements. One such currency is AUDJPY.
At the bottom of my chart you can see a inverted head & shoulders pattern ( indicated in pink ) along with a divergent RSI reading. This pattern compleat At a down sloping channel top trend line by breaking past it, then retesting it, before moving much higher along with similar moves in the stock market.
Currently it’s very close to its 61.8 FIB retracement, the same with stocks as in the S&P 500. AUDJPY also in recent days has shown signs of slowing momentum, and again RSI is diverging. With price action well above the 21 SMA and the 21 is well above the 89 SMA, simply makes my case for at least a pull back in the making—or something much bigger.
My trade plan is to take small shots at going short as this pair makes new highs, with a over all target to going short if or when it tests the big figure of 70.
All the best in your trades. Trade your plan and plan your trades accordingly to your risk tolerances. This is not trade advice, but presented as a form of how I look at the markets and thus should be used as educational materials.
In FX trading you either make dust or you eat dust. All the best.
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