USD/JPY trading tip using RSI and moving average

By QuintoTrader | Quinto Trader | 22 Aug 2019


RSI is an oscillator indicator while moving average is a trend indicator.

Today being Thursday August the 22ND of 2019, the USD/JPY market has been in a bullish trend most of the time.USD/JPY market has managed to rise above 106.63. The question is will this bullish trend continues or will the USD/JPY market reverse and become a bearish trend. This is indicated from the candlesticks chart below;

    USDJPY.png    

 

From the candlesticks chart above, there is point A which is located along the RSI and point B located along the moving average. Although the USD/JPY market has been in a bullish trend most of the time and we don't know whether the USD/JPY market will continue to be in this bullish condition or it will reverse and become a bearish trend, we can use the concept of RSI and moving average to predict the direction of the USD/JPY market for the remaining time.  

Concept of RSI

Using the concept of RSI, the market is normally considered to be overbought if the RSI rises above 70 and oversold if the RSI falls below 30. At point A, the RSI has risen above 70 thus an indication of an overbought USD/JPY market condition. Although the USD/JPY market has been bullish today and managed to rise above 106.63, we can decide to follow the concept of RSI and open a sell position because at above 70, that is an indication of an overbought market condition thus the USD/JPY market will reverse and start downwards trend.

  Concept Of Moving Average

Using the concept of moving average, the market is considered to experience a reversal trend if the price rises above the highest high of a moving average or falls below the lowest low of a moving average. At point B, the price has risen above the highest high of a moving average thus a downward reversal trend has started to take place. Although today the USD/JPY market has been in a bullish trend and managed to rise above 106.63, We can decide to follow the concept of moving average because the price has risen above the highest high of a moving average and open a sell position. Here is how our trading idea for USD/JPY  sell market looks like today;  

SELL 106.63       T/P 106.13   S/L  107.13  

Make sure to apply risk management while opening your position because this is not investment advice but just a trading idea

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QuintoTrader
QuintoTrader

Trader, Blockchain Technologist and Contentpreneur. Also founder and CEO @ Quinto Trader


Quinto Trader
Quinto Trader

Teacher forex school provides individual with training regarding to forex trading and cryptocurrency trading. We also share trading ideas online for both crypto and forex market

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