Good morning Forex Kings,
Markets have turned risk on over night. AUD, NZD, CAD & EUR all rallied higher against the USD.
The DXY and JPY faced significant downside throughout the evening.
The EUR could be one to watch this week as Merkel offered a break through deal to shelf the EU from the corona virus fallout. The German leader proposed a $546 billion fund for economic recovery.
As markets begin to reopen crude oil continues its run higher, global equities also enjoyed a positive start to the week.
Today we are looking at the USDJPY as it has broken a key trend.
USDJPY – Weekly charts
On the weekly charts there is a bullish engulfing candle stick pattern. This means a continuation of a trend.
USDJPY – 4 Hour Charts
There has been a breakout of a pennant formation followed by a re-test.
We can now look to buy the pair with a fairly tight stop loss.
Trade setup: BUY Market execution, current price 107.32, stop loss 107.02 and take profit 108.02.
Stop loss: 30 pips
Take profit: 70 pips
Keep in mind the market needs to break 107.74 resistance so we will see how it reacts around that area.