Japanese Yen Broke out 100 Key Level

Finally, Japanese yen broke out 100. Weak hands were shaken out by the temporary plunge initiated at the NFP, which stopped just 2pips shy to make a 3-box reversal on hourly point and figure charts. Japanese yen managed to crawl back and remain above 100 during the rest of day. On daily PnF, yen just made a double top breakout at 99. Surprisingly, Yen formed a narrow range bar (NR7) on the key 100 level breakout.




British pound made a double top breakout at the former double top resistance level 1.4766 on hourly PnF. On daily PnF, it's a double top breakout at 1.47. The key resistance level is 1.49 (former swing high 1.4978/1.4982). British pound made a new high in 20 trading days (H20).




Euro made a bear trap at the NFP event, then closed right above the pre-event level.

Day Trading Rules - No Setup No Trade

As mentioned in yesterday's post Inside Day for Three Major Currency Pairs, euro is in a top building phase. It's a very tough switch from a trend mode to a swing mode. There were three false breakdowns from the top range. At the beginning of US session, euro formed three pin bars which indicated indecision. At 1:00pm, euro closed under the lower bound of the top range. Although we were anticipating a top breakout for trend following, we need to respect what the market is telling us now. There is no long signal yet. Patience is a virtue here. 3415 gonna be a key support level.


Pound did breakout and formed a higher top range. That's the kind of price action we would like to see in an uptrend. Pound made a 2nd new high of 20 trading days (H20).


Yen kept moving up and almost retraced last week's slide. Whether this up thrust will challenge the key 100 level, only the market can tell us.

03/16/09 Forex Market Comments

As mentioned on Friday's post, both euro and pound did breakout. The tricky part is before the breakout, there were shaken outs on Sunday afternoon. Both breakouts happened at 3:00am, and reached daily high before the US session. Euro also made a new high in 20 trading days (H20). The whole US session retraced back and found support at Friday high. Both euro and pound formed a nice up channel on hourly chart. It might be an opportunity to enter long position when the retrace touches the lower bound of the channel.

Japanese yen still stays at the top range. And today is a NR7/ID (narrow range 7 and inside day). If yen does breakout, it could challenge the key 100 level.