I'd like to use this space to post a few observations on how I approach the EUR/JPY pair. I like the E/J because it has a combination of trendiness, positive interest and low spreads that is hard to beat. I'm not sure how many others are following this thread but this can be a place for discussing trading this pair.
Here is my basic strategy:
The weekly chart determines the trend, and to some extent the daily chart. Pullbacks against the trend create entry points. I take multiple small positions and scale in to diversify entry points and to take advantage of the normal back and forth movement that happens within a given trend. I exit to bank profits when the market has extended in my favor, or when the trend has changed to cut losses short.
One thing I've learned about this market is that it can have significant pullbacks while still maintaining the trend intact so identifying and trading in the direction of the trend and keeping position size small is crucial to successfully ride out those pullbacks.
Here is my basic strategy:
The weekly chart determines the trend, and to some extent the daily chart. Pullbacks against the trend create entry points. I take multiple small positions and scale in to diversify entry points and to take advantage of the normal back and forth movement that happens within a given trend. I exit to bank profits when the market has extended in my favor, or when the trend has changed to cut losses short.
One thing I've learned about this market is that it can have significant pullbacks while still maintaining the trend intact so identifying and trading in the direction of the trend and keeping position size small is crucial to successfully ride out those pullbacks.