Trading Plan: Bullish Breakout for USD/JPY

This trading plan focuses on a bullish breakout scenario, where the price clears the resistance range between 156.275 and 156.608 and targets the completion of the Head and Shoulders pattern.


Trading Plan: Bullish Breakout for USD/JPY
This trading plan focuses on a bullish breakout scenario, where the price clears the resistance range between 156.275 and 156.608 and targets the completion of the Head and Shoulders pattern.

1. Market Conditions:
The current market is consolidating near resistance.
A breakout above the 156.608 resistance level signals the potential for a bullish continuation.
The target aligns with the expected completion of the Head and Shoulders formation between 157.753 and 158.070.

2. Entry Criteria:
Trigger for Entry: Place a buy stop order slightly above the upper resistance level at 156.650.
This ensures confirmation of the breakout above the range.

3. Stop Loss Placement:
Place the stop loss below the lower range of the support level at 156.100.
This level accounts for potential false breakouts and keeps the trade risk-controlled.

4. Take Profit Targets:
Target 1 (Conservative): 157.753 (completion of the first measured move in the Head and Shoulders pattern).
Target 2 (Aggressive): 158.070 (completion of the full Head and Shoulders pattern).

5. Risk-to-Reward Ratio:
Entry: 156.650
Stop Loss: 156.100 (50-pip risk)
Take Profit Levels:
Target 1: 157.753 (110-pip reward) → Risk-to-Reward Ratio = 1:2.2
Target 2: 158.070 (142-pip reward) → Risk-to-Reward Ratio = 1:2.8

6. Trade Execution Plan:
Monitor Volume:
Ensure volume increases during the breakout to confirm strength.
Confirm Momentum:
Use indicators like RSI (crossing 50) or MACD bullish crossover for confirmation.