CAD to JPY Forex Daily Trading Strategies that Work : June 22

In this trade, I’m looking at the CAD/JPY pair. We ended up forming a shooting star right at the 82 level on the hourly chart, and that of course is a fairly negative sign. We did perhaps overextend a little bit and as a result it looks like the 82 level is offering quite a bit of resistance as it had been so supportive in the past, a phenomenon known as “market memory.”

Looking at this chart, I think we could get a little bit of a drop, as the oil charts don’t seem to be influencing the Canadian dollar moment. I put my stop loss at the 82.15 level to take advantage of the round figure, as it should offer quite a bit of resistance. I set might take profit level at the 81 handle, which would essentially fill the gap again from several sessions ago. I believe at the very least we should head to the 81.40 level.

As the trade went further, there were private research pulls suggestion that the UK was going to stay in the EU, which suggested a bit of a “risk on” move. This of course sent the Canadian dollar above and beyond my step loss, as it does tend to be a bit of a “risk on” currency. However, when you look at the longer-term charts you can see that the previous resistance level did in fact hold so it is unfortunately a loss, but you can see that the longer-term regions remain.

In a bit of irony, 24 hours later we got the results that the British actually left the European Union, and this market eventually went in my direction. However, you have to keep in mind that if you set a stop loss order, you need to abide by it, as there is a reason for getting out of the market at that level. By sticking to your game plan longer-term, you do typically have a better chance of coming out ahead. This was one of those unfortunate trades in the markets that can work against you and then turn around and prove you to be correct.