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AUD/JPY on a String

AUD/JPY on a String

That Leonardo Bonacci is some trader! Almost a thousand years ago, he was all over the recent rally in AUD/JPY, correctly nominating short term support and resistance and potential turning points. Kind of.

20151211 audjpy

Although not a “clean” uptrend since August (note the lower high in late October) the Fibonacci retracement levels are providing a good guide to intra trend turning points. After topping out with a mini megaphone formation just below the 61.8% retracement level, there is some supporting evidence for the formation of a new down trend.

A fall through the 38.2% retracement level around 87.80 could be viewed as confirmation of the emerging downtrend. I want to give this trade plenty of room, as my initial target is just above the recent lows close to 82.00. I’m looking to sell at 87.65, with a stop loss at 88.25, giving a juicy reward to risk ratio.

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