USD/JPY Forex Signal - 21 December 2017

By: DailyForex.com

Yesterday’s signals were not triggered, as there was insufficiently bearish price action at 113.28.

 

Today’s USD/JPY Signals

Risk 0.75%.

Trades may only be taken from 8am New York time until 5pm Tokyo time during the next 24 hours.

 

Short Trade

· Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 114.07.

· Place the stop loss 1 pip above the local swing high.

· Adjust the stop loss to break even once the trade is 20 pips in profit.

· Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.

 

Long Trades

· Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 113.07 or 112.83.

· Place the stop loss 1 pip below the local swing low.

· Adjust the stop loss to break even once the trade is 20 pips in profit.

· Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.

 

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

I wrote yesterday that the level at 113.28 is likely to be a big test: if the price breaks strongly and cleanly above that, it will be a very bullish sign. I also had a slight bullish bias as the long-term bullish trend has technically returned. So, overall, the upwards movement is not unexpected. American stocks appear to have broken down, so that may signify an absence of a driver for an extended bullish move in this pair. I therefore think it is quite likely that the move does not have much further to go in the short-term, but a slow move up to 114.00 over the coming days would seem likely. I maintain a bullish bias.USDJPY

There is nothing important due today concerning the JPY. Regarding the USD, there will be a release of Final GDP data at 1:30pm London time.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.