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Long Trade Setup in Japanese Yen


Japanese Yen futures (6J) have been in a strong uptrend throughout 2016. When the price pulls back it has been bouncing off a rising trendline which extends back to the start of the year. The bounces off the trendline provide potential buying opportunities.

On the December contract, the most recent bounce took place on September 2, when the price hit an intraday low of 0.00963. The price has since moved higher, hovering in the 0.0098 region. That means the price is still near the entry area, between 0.009730 and 0.009665. A stop loss goes slightly below the 0.00963 low.

Figure 1. December Japanese Yen Futures, Daily Chart

0.0101 is a resistance region, so consider exiting there if going long. That resistance region, coupled with the rising trendline has formed a triangle pattern. An alternative exit is to wait and see if the price breaks through the 0.0101 resistance region (high 0.0101165). If that occurs, the triangle breakout provides a longer-term upside target of 0.0108.

On the other hand, a decline much below 0.0096 breaks the triangle to the downside, indicating a potential slide lower into the 0.0089 region.

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