Why All the Indecision?
Below is a Monthly chart of USDJPY.
Whichever side of the white horizontal line price is on represents the current trend on the Weekly chart; and which ever side of the maroon horizontal line price is on represents the current Monthly trend. So we can see that the current direction is down on the weekly, and up on the monthly. Another way of saying this is we have divergence between the short-term trends on the monthly and weekly charts. What this means to us is we avoid commiting to long-term positions in this market until we have coordination between these two most influential of time frames.
USDJPY is a leading indicator market for sure, meaning indecision in this market could mean tough sledding for trend traders in all the currency markets. However, a close above that white line, or below the maroon line would give us all a more clear picture.
Stay tuned…
DISCLAIMER: Futures, options and Forex (off-exchange foreign currency futures and options, or “FX”) trading involves substantial risk of loss and is not suitable for every investor. The valuation of futures, options and Forex may fluctuate, and, as a result, clients may lose more than their original investment