Last Thursday’s signals produced an excellent and profitable long trade following the bullish inside candle break following the bullish rejection of the support level identified at 109.85. If the price fails to break above 111.29 soon, it would probably be wise to take profit, either fully or partially.
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 111.72 or 112.36.
- 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 Trade 1
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.85.
- 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 has seen a very significant development, with the price making a strong and impulsive move up against the long-term bearish trend, and breaking the highest long-term bearish trend line shown in the chart below. The long-term bearish trend is dead. The price has continued to rise from here, even breaking above the resistance level at 111.29 during the past few minutes as at the time of writing.
This pair is back at the heart of the Forex market, and looks likely to continue to move higher if sentiment remains in favour of long stock markets. However, the next resistance level at 112.36 is very pivotal, and would be a logical area for profit taking. If the price gets above that level soon, it would be an extremely bullish sign for this pair.
There is nothing due today concerning either the JPY or the USD.