USD/JPY tagged our downtown target of 115.25 and made a 115.17 low this morning and then rallied 25 points off the lows. We have been short USD/JPY three times this week and have pulled down around 150 points. But, like all good things, the party must come to an end. USD/JPY cleared the 115.50 stops, but has rallied back to consolidate above support.

EUR/USD is re-approaching the 1.2900 resistance zone and it's my opinion that without further economic data confirming the Fed is done, EUR/USD will not break to new highs. So, with EUR/USD stuck at range resistance and USD/JPY trading with a generally offered theme, the play does not seem to be in dollars, but in the crosses.

I have been watching this EUR/JPY chart snuggle up into 149.00 resistance for days now. Picking the top of this freight rain is sure to be a tricky proposition, but if we get it right, we could easily have a 3-big figure week. There are actually four factors supporting a trade against the trend. First, is the AB=CD measured move at 148.53 that you all know I love so much. Second, is the 1.618 Fib extension at 148.82, which I also dig. Third, is trendline line resistance that always works for me. And lastly is the Momentum Indicator divergence, which is not too shabby.



The 30-minute chart will be our execution chart. Look to sell into .618 and .786 retracement resistance between 148.60-70 with stops just above the highs at 148.95. Your average price will be around 148.65 with 30 points of risk. If you see some hesitation at those 148.25 New York lows, take some back and move the stop down to take risk off the table.

As I mentioned above, if we skewer this trade, look to keep a small piece for the panic profit taking down into 146.00 zone.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

Disclaimer
The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.