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Developing story

AUD/JPY has formed a support structure on both the monthly and daily time frames that open the prospects for a high probability continuation trade.

Swing traders will monitor for entry on the lower time frames, such as the 4-hour chart, looking to a high probability setup with favourable risk to reward.

The following is a top-down analysis of how the trade setup could evolve.

Monthly chart

The monthly chart shows that the price us in a strong uptrend having broken above the prior resistance now turned support and holds above the 21 EMA with bullish technical readings on RSI and MACD.

Daily chart

The price has given the market a sufficient retracement to the support structure for bulls to start monitoring for a long swing trading opportunity.

4HR chart

The price is not ready for trading until it gets above the 21 EMA on the 4HR and current resistance that will turn support on a retest for a 1:3 risk to reward ratio and high probability setup.

This is a developing story and price action will be monitored from a 4HR perspective IF the price can break higher from here. If not, then the trade setup is invalidated.

More to come…

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