Two potential long term breakouts are emerging in the most unlikely spots…the yen carry trade: EUR/JPY and NZD/JPY
Everyone has been used to yen strength this year and everyone has been accustomed to the idea of the “carry trade” selling off for even longer.
So if this breakout occurs in the upcoming days to weeks as I suspect it will, it will catch many traders off guard. There are still a ton of traders “short” on this trade that will be caught on the wrong side of the trade and will have to reverse their positions.
Also, there will be many former “carry traders” that have given up on the concept and will have written it off by now as a strategy. It’s about that time when these new, fresh breakouts occur.
Click on the EUR/JPY chart below and you’ll see what I’m looking at. If 126 is decisively cleared then the pair could move to the 130 level fairly easily.
The NZD/JPY looks the same way. Click on it below to enlarge it. If it clears 50 solidly, then we could see 55 hit pretty easily. Remember, these aren’t day trades. These are trades that could break out in the upcoming days to weeks. When they do, the trades would last probably for days to maybe a week or two. So we’re talking longer term trades but with a higher number of pips to potentially be gained.
Everyone has been used to yen strength this year and everyone has been accustomed to the idea of the “carry trade” selling off for even longer.
So if this breakout occurs in the upcoming days to weeks as I suspect it will, it will catch many traders off guard. There are still a ton of traders “short” on this trade that will be caught on the wrong side of the trade and will have to reverse their positions.
Also, there will be many former “carry traders” that have given up on the concept and will have written it off by now as a strategy. It’s about that time when these new, fresh breakouts occur.
Click on the EUR/JPY chart below and you’ll see what I’m looking at. If 126 is decisively cleared then the pair could move to the 130 level fairly easily.
The NZD/JPY looks the same way. Click on it below to enlarge it. If it clears 50 solidly, then we could see 55 hit pretty easily. Remember, these aren’t day trades. These are trades that could break out in the upcoming days to weeks. When they do, the trades would last probably for days to maybe a week or two. So we’re talking longer term trades but with a higher number of pips to potentially be gained.
