USD/JPY Forex Signal - 6 May 2019

Adam Lemon

Last Thursday’s signals were not triggered, as none of the key levels were reached that day.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be entered between 8am New York time Monday and 5pm Tokyo time Tuesday.

Short Trade

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 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 110.25.

  • 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 last Thursday that the situation was still slightly bearish as long as the price was unable to break above 111.69, and the bulls appeared to have failed there again in recent hours. I thought that the price would consolidate until the non-farm payroll releases due Friday after Tokyo closed so I had no directional bias. This was a good call as the price did consolidate under the resistance at 110.69 during that period.

We have no long-term trend, but the risk off, trade war, fearful market sentiment today as President Trump ramps up the trade dispute with China, has boosted the Yen quite strongly, and it shows no sign yet of breaking up past the new resistance at 110.88. Unless there is some progress between the U.S. and China on this issue, the Yen is likely to remain strong today, so I would take a bearish bias if we get a healthy bearish rejection of 110.88 later after New York opens.USDJPYThere is nothing important due today concerning either the JPY or the USD.

About the Author
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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