Yesterday's signals were not triggered, as there was no bearish price action at 111.75 or 112.06.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered from 8am New York time to 5pm Tokyo time, over the next 24-hour period.
Short Trades
- Short entry following a bearish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 112.57 or 113.13.
- 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 run.
Long Trades
- Long entry following a bullish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 112.06, 111.75, or 111.60.
- 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 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 there was short-term bullishness, but it was not clear that it was going to last. I had no directional bias. I should have had more confidence in the bullish move, which has continued, printing new higher support levels and invalidating the resistance at 112.06. There is also a long-term bullish trend and with the European pairs looking more consolidative, this seems to be at the heart of the action in today’s Forex market. There are good reasons to be bullish, although the ADP data release later could push the price back down if the number disappoints the consensus. I have a bullish bias until that release provided the price is above 112.06.
There is nothing important due today concerning the JPY. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change data at 1:15pm London time, followed by ISM Manufacturing PMI at 3pm, Crude Oil Inventories at 3:30pm, and the FOMC Statement and Federal Funds Rate at 7pm.