USDJPY: Trend line and retracement level suggests a long trade.
I predict that the price will reverse its direction at the 0.618 Fibonacci retracement level. The trend line acts as a pivot point for trend reversal. Therefore, my prediction is further suggested by the fact that the price just recently tested this trend line. The DMI also shows an expansion which suggests that a new trend might form. Furthermore, the Relative Strength Index shows us that the market was oversold right when the price touched the trend line.
As a result of this, I predict that a long trade would be the best option for now with a Take Profit which could be in between 124.496 and 124.562. In case my prediction turns out to be incorrect, a stop loss below the trend line and the 0.764 Fibonacci retracement level would be a suitable choice as it is clear that the price may test as low 124.172 and still reverse direction.
Stop Loss: 124.155
Take Profit: 124.496 (or between 124.457 and 124.562)
Risk/Reward Ratio: 2.63 (or 3.33, depending on Take Profit placement)
As a result of this, I predict that a long trade would be the best option for now with a Take Profit which could be in between 124.496 and 124.562. In case my prediction turns out to be incorrect, a stop loss below the trend line and the 0.764 Fibonacci retracement level would be a suitable choice as it is clear that the price may test as low 124.172 and still reverse direction.
Stop Loss: 124.155
Take Profit: 124.496 (or between 124.457 and 124.562)
Risk/Reward Ratio: 2.63 (or 3.33, depending on Take Profit placement)
