I went long EUR/JPY last week when the market came down to the bottom of its range. The range failed to hold, the market breaking out on the downside on Tuesday. Fundamentally, worries about the Eurozone periphery dominate the news (and because the problems are political, the worries will continue — political problems are slow to fix), while the yen is inclined to strengthen on the China tightening story that is also to the fore at present. The EUR is on a downward trend against the USD, while the JPY is on an upward trend, and this is supportive of the trade — for now.

Because currency markets are fuzzy, I waited for a reaction against the breakout on the daily chart before entering.

Charts, from IG Index, show the support level and the approx. level of the stop. I made the charts as soon as I had entered the trade this morning.