Another test overnight was beaten back but it's looking a matter of when, not if, the level breaks
This morning I spoke to Tip Tv about the 100 level in USDJPY. There's no denying it's become a big level. Each time it gets tested the sellers chip away at the buyers resolve but they're still hanging in there.
The chart below paints the best picture of what's happening right now.
USDJPY H4 chart
There's plenty here for everyone. If you want to lean against the 100 level for longs, you can do so very tightly. If you're a seller from above, you know where you should think about profit taking. No matter what your view or position, you know where the main risk lies, and that's at 100.
The beauty of trading is that we can all have differing opinions about which way it will go. The important part is that we trade those opinions correctly by assessing what's in front of us.
I've been happy to play longs from the level but I know where I've needed to look at getting out. I don't like the look of the 4hour chart for my strategy so each time I may trade it I bear that in mind and my stops stay close so I don't undo three or four good trades in one if it does blow up.
I think a break is coming soon as you can't ignore the selling pressure that's been in place all year. The longer it goes without breaking, the bigger the break will be. If we do look like breaking, I'll look to go with that break and maybe a short just under 99.80. In the first instance I'll keep a stop close just above 100 to guard against yet another fake out. A test and confirmation of a hold below 100.00 will be the real signal I'd be looking for to add to shorts.
Only a strong move above 102.00 would relieve some of this bearish pressure and that looks unlikely right now. As we always say though, don't guess, trade what you see.
