I tried trading the AUDJPY during the Asian session today. Price on the 5M chart had begun to fall, before stopping and forming a range.
The H1 and H4 charts showed that the longer-term bears were in control, but the 5M chart showed an uptrend (the 60SMA was pointing up). However, price on the 5M chart had returned to the vicinity of the 60SMA, which showed that price may resume moving downwards again.
I looked to go short in the top of the range. When I saw a smaller bullish candle form at the top of the range, I saw this as a sign of buying momentum slowing down, and went short.
The next candle broke the high of the range, and was again bullish. Seeing no evidence of bears taking full control, I closed the trade and ate a -0.6R loss. Price eventually broke upwards and would've taken out my stop loss.
I think my entry was a little premature. A better option would've been to wait and confirm a bearish reaction at the top of the range, and then enter with a sell limit order. I entered early, probably to be 'clever' but also because I was scared of missing out.
(click to enlarge)