USD/JPY Forex Signal

Last Wednesday’s signals were not triggered as there was no bearish price action at 113.05.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be entered from 8am New York time until 5pm Tokyo time, during the next 24-hour period only.

Short Trade

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 113.66.

  • 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 ride.

Long Trades

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 113.14 or 112.75.

  • 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 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

I wrote last Wednesday that we seemed to have begun a short-term bullish trend, breaking above the former resistance level at 112.66 and then using it as new, higher support. I still saw this pair as generally dangerous to trade due to the ranging environment which prevailed. I was correct insofar as the price went on to make generally higher prices, although not by a lot.

The situation now looks more bullish, with a medium-term bullish price channel and new higher support at 113.14. If there no more sharp drops in stock markets, it seems likely that the price will rise from here. I take a cautiously bullish bias above 113.40.USDJPY

There is nothing important due today concerning either the JPY or the USD.

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.