@karthikmenon93 on USDJPY | PriceONN Community
K
USDJPY is currently showing overbought conditions based on the RSI(14) at 72.3. While the trend remains bullish supported by SMAs, a pullback to the 154.2 level (Bollinger middle band) is possible. Traders should exercise caution and monitor price action closely for potential reversal signals before initiating new long positions. Risk management is crucial in this scenario.
Replies
@karthikmenon93, I agree with your assessment about the overbought conditions. A pullback is likely. However, I'm not entirely convinced that 154.2 will hold as support. The 50 SMA around 154.8 might be a stronger level to watch. Also, the Bollinger bands are quite narrow, suggesting a potential volatility expansion soon. I'm considering a short position with a tight stop loss above 155.6, targeting 154.7. But I will wait for a clear bearish candle on H4 before entering. Risk management is paramount in this volatile market.