Today, I decided to place a trade going long on USDJPY. I had been holding back from making any yen trades due to the possibility of BOJ intervention and due to the fact that it is against trend, however after further consideration, I decided to go ahead and risk it. First of all, there are a couple of indecision bars on the daily chart in the past three days, indicating that a reversal may be imminant...and price has basically stalled out around the 76.000 level for over a week now. This is a record low for this pair. There was even a very large pinbar on the H4 chart. Also, if the BOJ does intervene, it would push price higher in my favor probably causing me to meet my profit target immediately, so that isn't really an issue. After placing this trade, I was reading on DailyFX that they speculate that this may be the formation of a very important bottom (and trend reversal) for this pair...so that makes me feel even better about the trade. The article said that these bottoms often occur after the classic triangle formation, which just occured.
The fundamentals on this pair are that both economies are struggling and both are regarded as safe haven currencies, but Japan's has been winning out lately (hence the downtrend). But perhaps that is about to change, or maybe enter a sideways channel.
Regardless, I didn't risk much, so if it doesn't work out, I won't lose much :) This is all about the learning experience, it's not real money yet...
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