USDJPY Shorts to 146.800
My bias for this pair is very much so bullish due to the fact that price has entered the last (8hr) supply zone of the chart. Not only has it swept so much liquidity, but the initial rejection ended up causing a change of character to the downside on the 4hr time frame. As we can clearly see wyckoff distribution play out, there have been nice POI's left for us to enter sell positions from, like the 15min unmitigated supply at the top or the 17hr supply zone just underneath.
We will wait for the pullback to come back to these areas to re-distribute on the lower time frame in order for us to get the most premium price to sell at which will maximise our risk to reward ratio. Ideally we would also wait for the asian high to get swept first at 150.420 before looking at entries, as there will be no more reversal magnets against our trade. Our sells will then be in a very good position for price to just melt down.
Scenario B is that USDJPY will end up making new highs and break the POI's marked out. This would be expected when the current pull back comes and fails all the supply zones at the top to take out the ATH's (All time highs of the market.) However, even then we will also expect a bearish trend to form once price decides to sweep ATH's as that is also a strong form of liquidity.
My confluences for USDJPY shorts are as follows:
- Price has tapped into the last 8hr supply zone of the market that also caused a change of character on the 4hr.
- Liquidity has also been swept inside the zone from the upthrust distribution and has now left valid POI's
- Once the asian high gets taken there will been reversal magnets against our sell bias.
- Lots of liquidity to the downside to target as take profit targets i.e. Trendlines, equal lows, untouched asian lows and long wicks to fill.
- There is also a 15hr demand zone at the bottom that price needs to eventually mitigate.
P.S. There is also a 3hr supply POI underneath the asian high that it could react off but I would like to see a clear CHOCH and maybe even a break of structure to validate the hold of that supply. As we have identified both feasible scenarios, we can now prepare for the markets price action to play out and make our moves from there. But we must remain adaptive at all costs and know either could occur in this markets forecast.
We will wait for the pullback to come back to these areas to re-distribute on the lower time frame in order for us to get the most premium price to sell at which will maximise our risk to reward ratio. Ideally we would also wait for the asian high to get swept first at 150.420 before looking at entries, as there will be no more reversal magnets against our trade. Our sells will then be in a very good position for price to just melt down.
Scenario B is that USDJPY will end up making new highs and break the POI's marked out. This would be expected when the current pull back comes and fails all the supply zones at the top to take out the ATH's (All time highs of the market.) However, even then we will also expect a bearish trend to form once price decides to sweep ATH's as that is also a strong form of liquidity.
My confluences for USDJPY shorts are as follows:
- Price has tapped into the last 8hr supply zone of the market that also caused a change of character on the 4hr.
- Liquidity has also been swept inside the zone from the upthrust distribution and has now left valid POI's
- Once the asian high gets taken there will been reversal magnets against our sell bias.
- Lots of liquidity to the downside to target as take profit targets i.e. Trendlines, equal lows, untouched asian lows and long wicks to fill.
- There is also a 15hr demand zone at the bottom that price needs to eventually mitigate.
P.S. There is also a 3hr supply POI underneath the asian high that it could react off but I would like to see a clear CHOCH and maybe even a break of structure to validate the hold of that supply. As we have identified both feasible scenarios, we can now prepare for the markets price action to play out and make our moves from there. But we must remain adaptive at all costs and know either could occur in this markets forecast.
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