Yesterday’s signals produced a losing short trade following the bearish inside bar break upon the rejection of the resistance level at 109.76.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be entered from 8am New York time to 5pm Tokyo time, over the next 24-hour period.
Short Trade
* Short trade entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.52.
* Place 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.
* 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 trade entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.52 or 109.00.
* Place 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.
* 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 took a slightly bullish bias yesterday and that worked out OK. There is not really any change to the technical picture. The market seems to be focused on other currencies against the USD, not the Japanese Yen. The price just can’t get to or beyond 109.50. Having said that, support is holding, and the pair is still being bought, so there is no reason to abandon a slightly bullish bias. Yet the longer the price struggles to rise, the weaker that bias should become.
There is nothing due today concerning the JPY: it is a public holiday in Japan. Regarding the USD, there will be a release the ADP Non-Farm Employment Change forecast at 1:15pm London time, followed by Crude Oil Inventories at 3pm and the FOMC Statement and Federal Funds Rate at 7pm.