My picks: Stay Long JPY
Expertise: Fundamentals Combined With Technicals
Average Time Frame of Trades: 1 Day - 1 Week
I've mentioned a few long JPY positions over the past week or so, including a short USD/JPY trade from 4/15 (triggered on 4/20, still open) and a short AUD/JPY trade from 4/20. With risk aversion alive and well throughout the financial markets due to uncertainty about the true health of banks, I think it's worthwhile to stay long JPY.
I'll add one more specific trade to the list: short GBP/JPY. The pair broke below key trendline support this morning at approximately 142.85 (connecting the lows associated with the 2009 rally). Cautious may prefer to wait for a close below immediate support at the 50 SMA at 141.14 rather than getting in at market, and stops may be placed above the daily high of 142.87/143.00. Short-term targets include 135.20 (the 50% fib of 118.83-151.55) and 131.38 (the 61.8% fib and March 12 spike low), but this may ultimately serve as a good longer-term trading opportunity for a test of the record low of 125.40, if not lower.
