As you know if you follow our forex investment blog we have been long the AUDJPY for over 2 months now as you can see from this post (Forex Investing – AUD/JPY Trend Change – Go Long). Our initial entry position was at 62.15 with a 2% capital risk and 125 pip stop loss. The currency pair shot up right after our entry point and we then sold off half our position at 72.15 for a 1,000 pip gain and an 8% total gain on our capital, you can read that post at (Managed Forex Account -AUD/JPY Taking a Profit). We still hold the position of long the AUDJPY with our 1% position size.
We have since seen the pair continue higher while making another higher top and higher bottom, more bullish signals. As you can see from the chart below the bullish trend continues as we continue to raise our stop loss along with the trend. We have now moved our stop loss to 66.60 which at a minimum guarantees us a gain of another 445 pips. The stop loss is actually set two boxes below the trend line because we want to also include the previous support set near the trend line.
We will continue to monitor this trade and raise the stop loss along with the trend line and previous support levels.
If you like our technical analysis then please be sure to check out our other forex investment blog posts and read more about our managed forex account.
On April 10th we updated you on the AUDJPY trade we made in the managed forex account in a post called (Managed Forex Account – AUD/JPY Taking a Profit) where we had sold half of our 2% capital position after gaining 1,000 pips and to give us an 8% gain on the overall account.
We are still in this trade but have seen the AUDJPY fall back down over 500 pips on a pull back, this was somewhat expected as it had such a strong rally. The chart still looks very good at this point with nothing to make us to worried.
We remain in this position as the trend still remains above the trend line. As of right now our stop loss is at 64.65 which would be a sell signal and a change in the trend. The stop also does guarantee us at a minimum a 250 pip gain on the trade.
The EURJPY trade that was entered in the forex managed account last week in the post (Forex Managed Account – EURJPY Going Long) has now been stopped out. As you can see on the chart it broke previous support where we entered the trade giving the first sell signal in the new uptrend.
We had only placed a small trade of 1% capital on this trade due to our exposure already in the AUDJPY trade. We had a quick stop loss of 100 pips that did not hold. As of right now the up trend is still in place for the EURJPY.
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We tried to make an entry into the EURJPY around March 14th but never got the pull back we were waiting on to make the buy entry. You can view that post at (Forex Investments and Managed Forex Account – Long EURJPY). Since then the EURJPY has continued its upward move but has recently given us a good entry point on the recent pull back.
Looking at the chart below you can see that since breaking above the trend line it has made continuous higher tops and higher bottoms which is very bullish. The currency pair has now fallen back to previous support and it is again near the trend line which will also act as support.
We have already entered this trade at 126.90 and have placed a stop loss at 125.90 for a 100 pip stop. The stop is placed at the sell signal of the previous row of O’s on the chart, this would be considered a quick stop loss as the trend would not have been broken yet. We would rather use a quick stop loss on the entry as we can always find another entry point if we get stopped out.
The risk on this trade is 1% capital instead of the normal 2%. This is because we still have a position in the AUDJPY (Managed Forex Account – AUD/JPY Taking a Profit) of 1%. We do not want to get over extended against the JPY even though we are using different cross pairs.
If you like our technical analysis on the forex market be sure to read all our forex managed account trades on our blog and learn more about investing in foreign currencies with us.
This week has given us some big changes in the 1% point and figure charts. This chart is considered longer term so any changes in the trend is a big deal. It looks like the Japanese Yen (JPY) is getting weak and that is where we see many of the new trend changes. It also looks like the Australian dollar and the New Zealand Dollar are gaining strength against the major currencies. We have already talked about the NZD in our last post (Forex Investments – NZD/USD Trend Change) so we will focus on the other trend changes happening.
The AUD/USD has recently given us a buy signal above the trend line to confirm the trend change. We had talk previously about AUD/USD trend in both the post (Forex Investment – Has the AUD/USD Trend Changed?) and (Managed Forex Account – Has the US Dollar (USD) Trend Changed?) and in both we were waiting for confirmation of the trend change and we now have that. Looking at the chart you can see it has made a strong bounce up and we will now wait for a better chart pattern to occur before considering taking a position.
The GBP/JPY gave a buy signal above the trend line last week before pulling back exactly to the trend line and bouncing up to make another buy signal. This chart is in a very bullish trend right now as it continues to ride up the trend line.
The CAD/JPY has also given a buy signal above the trend line as you can see on the chart below.
Like all the previous charts the CHF/JPY has a very similar story. The chart shows a buy signal above the trend line confirming a trend change.
The NZD/JPY has now given us 2 buy signals above the trend line confirming the trend change.
It looks as though the Yen (JPY) strength we have seen for many months is now turning around. At this time we are going to stay with out current position of being long the AUD/JPY as you can see in the post (Managed Forex Account – AUD/JPY Update).
If you like our technical analysis be sure to look at our other post on our forex investment blog and also take a look at our managed forex account.
Since July/August of 2008 the JPY has made considerable gains across the board against every major currency. There are many fundamental reasons why people claim this happened with the most common being the unwinding of the carry trade. No matter what the reason all we care about is what the chart tells us. Lets take a look at several of the JPY charts. We will be looking at 1% box size point and figure charts, this gives us a longer term view to see if the major trend has really changed.
We have already taken a close look at the EUR/JPY on the post “Go long the EUR/JPY?“. Now looking at the chart we can see that after breaking the trend it pulled back to make a higher bottom (bullish sign) and is now trying to make a new buy signal. While I am not ready to go long the EUR/JPY just yet as I want to see a buy above the 21 ema, it does certainly show that the JPY trend may be changing if it can make the second buy signal above 121.
EUR/JPY
The AUD/JPY chart gives the most convincing chart that the trend has changed. It just broke the trend line and has given a buy signal above the 21 EMA. I would like to see one more buy signal above the trendline and then it will be time to go long the AUD/JPY.
AUDJPY
While the GBP/JPY chart is not as convincing it is useful to take a look at. You can see that it has consistanly made higher bottoms now and just broke to the upside out of a triangle pattern. All of those are bullish signals however all of this is happening below the trendline so we won’t consider going long. This chart does show however that there are changes going on in the JPY.
GBPJPY
Last we look at the USD/JPY. This chart is a perfect example of how well a point and figure trend line can hold. The USD/JPY has bounced exactly to resistance at the trend line and right now all signals still point down but it would not take much of a move for all of that to change. This is certainly something we need to keep our eyes on.
USDJPY
So has the overall trend of JPY changed? Not yet, but it is at a very critical point and i would think within a short period of time we should find out if any of the other currencies can really break through and change thier overall trend against the JPY. It looks right now like AUD has the best chance to make that happen.
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