Signal for 1/07/2009 for: GBP/JPY

Recap of yesterday's events:

Yesterday’s session was quite eventful to say the least. The market experienced a heavy 300 pips move to the downside following the European open. It was quite tricky to get in a trade yesterday; I managed to pull out 67 pips from the market on the downside.

The market has since experienced a retracement of nearly 200 pips. Well at this point price may experience a full retracement at the 156.72 level but this is merely a speculation at this point in time.

Today's Signals:

Our levels of concern for today are as follows:

R3-160.887
R2-158.860
R1-157.063
Pivot Point– 155.036
S1-153.239
S2-151.212
S3-149.415

Possible Scenarios:

Buy Signal:

For a buy to be triggered today, I will wait for price to trade above the pivot point first. At the moment of my analysis, price was hovering around the daily pivot point. If by London open, price finds good support at daily pivot, I will wait for the 155.70 level to be broken before looking for a valid entry point.

My profit target is set at 156.60 where we have some good resistance. Note that 157.00 level is acting as a strong resistance level at this point due to some heavy cluster formation around this region.

Thus if price wants to push further up, I will wait for a break of this level before thinking of buying with target profit set at 158.10. I doubt price will get there but we never know what can happen.

Sell Signal:

If by London market price is trading below pivot point and 156.65, we may see price head down to our first profit target set at 153.86 where I will exit my whole position.

To confirm my view of the day on the downside, I will wait for a break of 153.05. If price trades below that level, I will start looking for another sell entry with possible target set at 151.95.

Please remember that, proper money management will be required here to maximize your profit.

Wait for retest of the levels given once broken or until a bullish candle is formed after the retrace (preferably on 15 mins chart making sure that the 20EMA and 50SMA obeys the rule of entry)

PS – You may decide to use your own strategy and use those levels as entry and exit points

Happy trading.

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