USDJPY 12-15-06

12-15-06

USDJPY

A short trade at 1.1780 was entered yesterday and it was exited at 1.1750 which was a place that the USDJPY had based earlier in the day. The trick to staying in the game is not to argue with the market. When areas of breakout support form, I use them as first targets if I am in a position that is counter trend to the market. If they are less than 3 to 1 risk to reward, I pass on the trade all together to reduce the risk on the trade. Even though the USDJPY has been strong, it is in an area of supply on both the daily and weekly charts which extends up to 1.1835. Watch for a sharp reversal if the USDJPY manages to rally up to the 1.1835 - 1.1850 area.