EUR/JPY trendline and fib convergence on daily

EUR/JPY has traded aggresively upto the the 79% retracement level. The level converges at this time with the daily downtrendline. I believ there is a high probability of a bounce from this significant level at least enough to lock in some profit even if the aggressive move continues. I will be looking to for opportunities on smaller time frames to trade a breakdown in price from the 164.40 level. My experience is that this type of resistance is good for a 200 pip bounce conservatively on this pair. I am targeting the 161.60 level and will take most of my position of the table at that target. I will leave a small portion behind on the off chance we get a retest of the lows. A break and hold higher will be very bullish at which point I will look to cut my position and look for opportunities in the other direction

call was good achieving over 100 pips since yesterday - I hope some of you guys got some of it. It was about as tradable an opportunity as it gets and they only come on the daily chart every so often. I am surprised I didnt get a few posts from you guys with this call. Price gave me about 40 pips of heat after a stop clearing push above resitance but it failed to hold forming a nice comforting pin bar on the 4 hour chart. I am currently flat as I had a limit in place at 163.50 above the S2 pivot for the asian session. I am happy with that given the strength of the trend I was countering

price has completely recovered for a retest of the resistance. Trading the second touch is tempting but the probability is not as good as the first touch for a bounce trade. I have my pips and dont want to push my luck against the carry

Looks good MACD,
I saw your original call but didn't want to comment until you had traded your plan to an exit. What was your stop on that original trade? I did not trade this, because there was no defined resistance to place my stop behind, and I found it too dangerous to be trading against the prevailing trend with a larger stop. Also because it's a fresh week and hasn't picked a direction yet.

If you're looking for another trade, watch this 1hr development around the trendline you've drawn. I see a lower low and a lower high, with a tighter stop developing. You might try sneaking in smaller lots around that. I tend to "dot" the market with several smaller trades around these daily resistance levels, and can sometimes get several of those dots locked in for a longer term daily retracement.


Perhaps you should start a journal for these comments?

I used the 165.00 round number as the level to place my original stop behind. Price bounced at the TL/FIB level as expected and offered some pips but has since fully recovered and is hovering back up at the trendline. I agree with your lower timeframe approach to trading the resistance on the daily. That is how I entered this trade and I managed to bag about 50 pips trading from 3 positions at various levels before the bigger move occured with one remaining position. Thanks for the trading tip, I appreciate your sharing your approach and I;; have another look on the hourly. Price action holding at resistence is bullish for a break higher but I havent given up on the resistence level holding and price fallinf at least to the original target. Have you posted charts anywhere showing this "dot" method. I would like to see that! perhaps a journal from you may also be a good idea

As long as you understand your risk at all times, I am happy. I consider myself a risk manager more than a money manager and always have. I believe I have talked about dotting the market before, perhaps back in November-December with some chart examples. Maybe not though, I'm not going to look through my post history. Hehe...

My dotting method is pretty simple and probably not deserving of a dedicated thread. I use it on longer term entries to build up the percent of my account I have in the market without increasing my risk.

Basically, I trade my managed accounts extremely conservatively. Generally 2-4 mini-lots per 50k in the account, always less than 1% of the account at risk in the account (4 lots would be .8%). So to build up a decent amount in the market, I will find the trade on the day/week chart and begin dotting the market around the slow daily trend change.

I will enter once, when I am up a decent amount I lock in the market. Once I am locked in, there is no risk to my account so I can reallocate that risk and find another entry generally using the lower compression 1hr-4hr but understanding my goal of not finding an entry/exit but focusing on the entry itself and getting locked in.

If the stop gets hit and my locked in trade is gone, I am still looking for the next entry. It didn't cost anything to take the locked in trade out and it usually was locked in with +10 or so. Anyway, over the first 100-150 pips of the trend direction changing and beginning to move up, I will try to get as many of these smaller trades locked in around the turn to ride the new trend. I am not having to pick the top or bottom and slam it with 5% of my account, I am slowing working in several <1% trades to build up a couple of percent in the market, while only ever risking the 1 trade that is open with a negative stop.

I hope that makes sense. It's not a system of trading, more a style of money management. The last example I have of me using it is in January to buy the AUD/USD. I entered 8 trades between .8750 and .9000 and 6 of them were locked in without being stopped out. I scaled out a few of these positions when it broke that dominant daily trend line in the beginning of march however I am still in 3 of these positions, earning interest daily toward parity with the dollar.

The call was accurate with the market respecting the fib + trendline confluence and then bouncing at the identified support - precisely as predicted. I only took 90 pips out of the 200+ pip move south and did not have the courage to take the bounce yesterday, Its one thing to call it - altogether something else to trade the entire play. One day i will be that good.