Trade Example – AUD/JPY

Filed under: Learn Forex Trading |

I have an intraday price action trade example for you today on the AUD/JPY forex currency pair, which is the pair for the Australian dollar and the Japanese yen.

 

Figure 1.

To begin with, take a look at Figure 1. This is the daily chart for the AUD/JPY pair, and it is the timeframe that we use to assess the trend. As you can see, the chart visibly moves up from left to right, and the 8-day exponential moving average is crossed above the 21-day exponential moving average, which all confirms that the pair is in a bull trend. Momentum seems to be strong as the 8-day exponential moving average is diverging from the 21-day exponential moving average.

 

Figure 2.

Figure 2 shows the 4-hour chart for the same AUD/JPY pair. I have marked in a significant area of support/resistance on this chart with a green band. Then, if we zoom in further and look at the 1-hour chart in Figure 3, you will see that a nice pin bar reversal formed at this key level. This would have been a good time put an order in to go long at the break of the high of the pin bar, with a stop loss just a few pips below the low of the pin bar, and a target of two times our risk.

 

Figure 3.

As you can see, this trade would have been successful for a 2% rise on our bank. Although trading the intraday charts is trickier than the daily charts because they are more volatile and the levels of support and resistance are less reliable, there are trading opportunities to be had if you have already mastered trading on the longer-term timeframes. Well, that’s all that I have for you this week – and I’ll be back on Monday with more forex price action trade examples. Have a great weekend!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>