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Learn Trading – Forex Update: Watching USDJPY for the Next Move on NFP

By on November 1, 2020 0 60 Views
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So, as long as we’re underneath there and if we get less than good data, poor data today out of the US and jobs and earnings information, this becomes our resistance for an opportunity to go short. Now, if we didn’t have non-farm payrolls today, I might be looking to go short right now regardless of what’s happening in the news. So, we have non-farm. We’re going to give it a little caution. We’re going to say wait till 8:30. Wait to see what the jobs report does. If it’s positive, we might get right back above that blue-shaded area. Negative, I think we’re looking for a sell off here and possibly at least down to the pink zone into the 114s or lower, depending on how strongly poor that jobs information is.

Overall, of course fundamentally it makes more sense to go long on this currency pair, but right now we’re in a little bit of a slump for the USD. Let’s take it on down to the four-hour timeframe. And this is really the reason why I say if it wasn’t for NFP, we might be looking to go short. Again, there’s that last support there, where the blue circle is. The last support here, and we’re just stuck right underneath it as resistance. So, for the day today, we’re looking at this blue zone as a clear area to watch for our trading opportunity.

Underneath it and poor US data, we’re selling the blue-shaded area, looking for it to go down. If we get a surprise strongly positive news out of NFP, it would break through 116.50 and go back up towards the purple or orange-shaded area. So, definitely watching this blue zone for your trading opportunity today. Again, strongly poor or even less than stellar NFP today, higher unemployment claims, lower earnings – any of that, we’re likely looking for this to fall off of here and head back down towards the pink zone.

Could be our first signs here of some short or longer-term reversal underneath that last support. Think about this. If there’s buyers here in this blue-shaded area, if they got into the buys here because of that long wick there and they haven’t exited already, if we get a strong, poor jobs number at NFP, those people that are in buys here are going to quickly exit those trades. And when they exit those buys, that’s going to give us a strong sell off here towards the pink-shaded area or lower down even towards the 114 or into the 113s, the yellow-shaded area that sits down here at the bottom of the chart.

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