Last Thursday’s signals produced a losing long trade entry from the bullish rejection of the former lower trend line at about 108.15, with the trade failing to make the minimum 20 pips profit.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken from 8am New York time until 5pm Tokyo time, over the next 24-hour period.
Short Trades
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.69 or 109.49.
- Put the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trades
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 108.05.
- Put the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 20 pips in profit.
- Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
USD/JPY Analysis
This pair remains within the interesting situation which I outlined last week: technically within long and medium-term bearish trends, but very reluctant to stay below the 109.00 level, where it is rumoured that the Bank of Japan have been intervening and pushing the price up. Of course, the price has been well below 109.00 for a while, with new resistance at 108.69. This looks to be a key level and I think it will probably break as the U.S. Dollar looks to make at least a small comeback during the first half of this week. I suspect that 109.49 will be a more difficult level to break. Despite the short-term outlook, the pair is in a long-term bearish trend, and if tensions with Korea flare up, it can be expected to fall quickly.
There is nothing due today concerning either the JPY or the USD.