USD JPY Bears Have to Be Careful at 94.28

The main trend finally turned down on the USD JPY daily chart, but traders have to be careful initiating new shorts at current level because of a retracement target at 94.28. 

On Wednesday, the USD JPY fell as weak economic news in the U.S. triggered a profit-taking break in the equity markets. This action led to a reversal in the carry trade, a strategy in which traders borrow the lower yielding currency to invest in higher yielding assets.

The break through the last main bottom at 95.62 turned the main trend to down on the daily chart. Traders have to be careful selling weakness at current levels because the market is approaching a key 50% retracement price at 94.28. Patient traders may get a chance to sell at a better price if they wait for a retracement back to 97.44.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More