USD/JPY Forex Signal

Yesterday’s signals were not triggered, as there was no bullish price action at 110.25.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be entered between 8am New York time Wednesday and 5pm Tokyo time Thursday.

Short Trades

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.29 or 110.88.
  • 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 Trade

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.59 or 1.0915.
  • 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.

Great trade opportunities are waiting. Don't miss it!
TRADE NOW

USD/JPY Analysis

I wrote yesterday that the picture remained essentially bearish and the support at 110.25 and the major level at 110.00 below that were very important long-term support – a sustained break below 110.00 would be a very bearish sign and a strong move down is looking quite possible. I was ready to take a bearish bias if the price could trade below 110.25 for a couple of hours later.

This was a fairly good call as the price did fall further over the day, trading below 110.25 but recovering most of its value since that break was made.

The risk-off sentiment due to the trade dispute over tariffs continues, which is strengthening safe haven currencies such as the Japanese Yen. The price is now at a key technical point – this area just below the psychological level at 110.00 has been long-term support and resistance. It is also the area of a 50-day low, so the Japanese Yen stands on the brink of establishing a long-term trend against the U.S. Dollar. We also see an increase in volatility in this currency pair, and it is certainly at the centre of the market’s focus right now.

 I would take a bearish bias if we get an hourly close later below 110.00, or if there is a bearish rejection at a test of the resistance at 110.29.

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.