Transcript of Video
From Forex Traders Daily, this is your daily analysis with Ross Mullins, live from Richmond, Virginia.
Hello everyone, this is today’s video analysis for June 12, 2018. Today we’re taking a look at the US Dollar versus the Japanese Yen [USDJPY] for today’s trade analysis.
A couple of different trends we want to look at. Short-term. Long-term trends. Long-term we have seen this currency pair overall in an uptrend. You could see the black trend line here rising for a couple of months, going all the way back into March of 2018, this year. We pushed through the 100-period simple moving average. That’s the green wavy line here on the chart. 100-period simple moving average applied on the daily timeframe. We’re above that.
So, primarily I would say this currency pair has been in an uptrend for a few months now, since March. We have seen it in a bit of congestion as it’s bounced around. Intraday-wise, we’ve seen it fall along, and I’ll put another trend line here. Along this blue trend line. It went down for a period of time and now we’re seeing it turn around and move right back up in the other direction.
So, we’ve seen a couple of trends in place here. Right now currently of course the momentum is more bullish than bearish. It has been for a couple of days now. We also see the Forex Black Book has remained green, giving us a more bullish momentum bias here to the currency pair. But we’re running into significant resistance today. I want to point out a couple of things about the 110.20, 110.35-level, the pink-shaded area in the middle. Sort of in the middle of the chart.
110.20. 110.35. Follow it all the way back to the left-hand side of the chart, where the black and the green circle is. You could see the black circle. Support into that same 110.20, 110.35-level. The green circle: resistance into that same level. So, as long as it was above it, it was finding support. Below it, it found resistance. So, that’s important information for us as we look to make our trades today. Specifically, the green circle because the green circle shows us as the market was coming up, the inability of the market, the buyers, to push through 110.20, 110.35, and go back up to the orange zone again.
It had that inability to do that. So, we don’t want to fall prey to that. We don’t want to try to buy under the pink zone, 110.20, 110.35, and have it turn around and go back down like that. That just wouldn’t be fruitful for us. So, how do we protect ourselves from a false move above? How do we protect ourselves from buying underneath and running the risk of it turning around and going back down?
Let’s go ahead and zoom it in now into the current market. Here we are one more time into the pink zone. Let me see if I can zoom in one more time. There we are. Here we are. A couple of days ago, last week, we saw the market target here into this pink zone, find resistance, and bounce down. Went all the way back down to 109.20. Now here we are, challenging again. So, the real question is: how will we know when the market is clearly breaking and going to continue the rise, continue the uptrend, and move back up towards the orange zone?
So, clearly that’s the next resistance. Well, for me, I’m often looking for a single candle body to get above. Primarily here on the daily timeframe to give us some higher confidence. Remember you and I – we have zero control over what’s happening. The rising and falling – we don’t have any control over that. So, what we want to do is gain confidence that the rising and falling is going to continue in a particular direction. Whether it’s up or down, we want to gain confidence.
So, the best way we’re going to gain confidence that it’s going to continue is we look for the breakout setup. We look for the market to get above the pink zone. That gives us higher confidence that it’s going to be a real breakout. Often. Not every time, but often we’ll look for a dip back down. Kind of a retest as support to tell us to confirm that level – 110.20, 110.35 – is a barrier of support and then we’ll look for that next rise towards the next resistance level, the orange-shaded area.
It happened over here. Not really clear. It happened here, where it got above this daily candle right here. The blue candle. Did dip back down to the pink zone and then it went to the orange zone. So, that’s really what we’re looking for. We’re looking for it to get above. Often a dip back down to confirm that level again and then the continued rise. It doesn’t have to do that though. It could simply fall off of this pink zone, get back underneath it today, and turn around and go back down.
So, really we’re watching for two things. Yes, I would prefer the buy. I would prefer it to get above and continue the current momentum, but we also want to watch for reversal. If it finds resistance here, we could see it turn back down. That’s what happened here at the black circle, right? Found resistance, turned around and went back down. That’s what happened back at that green circle we looked at, at the beginning.
So, we want to really watch for both of these setups. Let’s take it back down to the four-hour timeframe. And as we get down here, we could see the struggle the market is having around this level. Have we seen the market get really truly above the pink zone? Not really. Have we seen it reverse and go back in the other direction? Not really. So, we’re kind of just struggling around this 110.20, 110.35-level.
A solid push above will give us higher confidence that it’s going to continue to go back up. So, again, it’s kind of that breakout, retest, and then rally back to the orange-shaded area. It will give us higher confidence. And then again, sudden reversal. A sudden push back underneath 110.20, maybe even 110.15, will tell us it’s going to fall back down to the blue zone. So, we’re really watching for these two trade setups here around this pink-shaded area today for the USDJPY.
From Forex Traders Daily, this has been your daily analysis with Ross. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.