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Sunday, October 24, 2010

Currency Focus: Looking at the USD/JPY

Swing traders have been looking closely at the 79 area as an area to buy the pair for a major reversal, and no doubt they were listening closely to the media coverage of the G-20 to find out how likely it is that countries will intervene to weaken their currency to help bolster their economy.

Depending on your risk appetite, I think current price levels may be a bit premature to take that swing trade.  I am liquidating my long and will look for opportunties to buy the pair again at a better price.  I no longer see the BoJ looking to intervene right at the moment unless the pair begins to suddenly lose all footing.  Famous last words I am sure, but I'd be more comfortable holding the long closer to the all-time lows or if price tumbles quickly.

I liquidated my position for a small profit, and my trade journal has been updated accordingly.  No new order has been placed, but watching the pair closely.

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