USD/JPY Forex Signal - 28 May 2019

USD/JPY Daily Forecast 28^th May 2019

Yesterday’s signals were not triggered, as none of the key levels were ever reached.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be taken from 8am New York time Tuesday until 5pm Tokyo time Wednesday.

Short Trades

• Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.81, 110.11 or 110.36.
• Put 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 109.07 or 108.73.
• Put 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 yesterday that although we had seen a recovery in risk-on sentiment, it was still impossible to look at a price chart of this currency pair and feel confidently bullish. For this reason, and due to the fact that the trade dispute had still not been resolved, I stuck with looking for short trades from solid bearish reversals, ideally at 109.81, during the later Asian session. This was a good call on the direction as the price currently seems to be breaking down, or at least testing nearby recent lows, but the price never retraced back up to 109.81 to trigger a possible short trade entry.

The price is looking more bearish at present, but there are reasons to see the support just above the round number at 109.00 as strong. If the U.S. stock market falls strongly later, it would probably push the price to reach the area below 109.00. Generally, I am looking for short trades and not long ones, but the only reliable resistance I see anywhere nearby is some distance further up at 109.81.

There is nothing of high importance due today concerning either the JPY or the USD.