USDJPY: Price advances within bullish channel
Yesterday’s signals produced a profitable long trade from the bullish pin candlestick which rejected the support level at 109.81. It would probably be wise to take profit as it seems the price has topped again just below the key resistance level at 110.29/
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 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 Trades
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.81, 109.50, or 109.07.
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 I saw this pair now with no trend really, having just made a bearish turn at 110.29 that looked very solid. The price would now probably fall to test the next support at 109.81 but the support level at 109.50 looks more likely to be strong, so I would take a bullish bias if we get a firm bounce at that level later after a retracement. I was broadly right but wrong about the level, as the support held at 109.81 not 109.50.
The price chart below shows we can now draw a convincing bullish price channel to cover the past week or so. However, we have a double top at 110.29 as well, which is a bearish sign. If the price can get established above that level, it would be a bullish sign, but the odds of a break below 109.81 are only slightly less. Otherwise, I take no directional bias on this currency pair today.
There is nothing of high importance due today concerning either the JPY or the USD.