Nothing makes your Sunday morning like the newest cost saving initiative from airlines. Seattle Times reports that head of Ryanair had asked Boeing to design an airplane restroom door that can only be unlocked by paying with a credit card. They could charge about anything, while the customer is under pressure. There was an explanation from airline official on this unusual step. Michael OLeary insisted this is meant to help put curbs on “unnecessary visits to toilets”. Guess Ryanair travelers prefer the ambiance of lavatory to that of main cabin. Or, perhaps, coach passengers treat time spent in restroom as a free upgrade to first class. Doesn’t everybody just love to hang out in that sardine can?
Some parts of the country have been hit harder than others by recession. Those who don’t believe that economy is in rotten shape, should read this. Junior high school in Canton, Ohio, posted an opening for one full time janitorial position. Response was overwhelming, with 700 applications collected. Most of them are recently laid off factory workers. Pretty sad….
OK, to the boring world of trading now. Week ago in “Conflict of time frames” I suggested a trade in NZD-JPY using 4H charts. This trade is still valid. Meantime few trades were taken using 1H chart of that pair. Currently there is another potential buy set developing on hourly charts of Yen crosses, but NZD-JPY is the least promising. While all of them are similar, some have better targets or stops than the others. Here is a look at GBP-JPY.

We can see ABC reversal pattern, crown or a variation of head and shoulders. Doesn’t matter the name, this is very common reversal type. They happen left and right on all time frames.  Price makes new low at B, then rallies to take out previous high (A) and establishes new high at C. Normally it is followed by a retracement to within the pattern, somewhere between B and C. This is the current picture. Development of this set up does NOT guarantee that the price will move up, but enhances probabilities of that happening, especially if somebody has bullish outlook to begin with. This potential turning spot on above chart is very wide, almost 300 pips. Couple of ways to play it- on a breakout above the high of C , or at the market if the price falls close to the low of B ( that would be stop as well). As of this writing both of these situations are present- bettor’s choice.
Same chart but AUD-JPY.

Set up is almost identical, but price didn’t dip after C as low as the Beast example. This presents certain dilemma. Underlying sentiment is still bullish, but entering at the market is probably not worth the risk. We are far away from potential stop at B and very close to likely resistance at C. In my opinion, buying breakout above C is the better choice here, unless price falls again to under 62.30-20. At this point at the market entry with stop under B makes sense.
Tomorrow I will look again at GBP-CHF, which proves to be very illusive buy. And whatever else develops. For now it is Yen and possible gaps- always on the lookout for those when markets open after the weekend.

Mike K.