USD/JPY Forex Signal - 31 July 2019

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USDJPY: Directionless ahead of FOMC release

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

Today’s USD/JPY Signals

Risk 0.75%.

Trades may only be entered between 8am New York time Wednesday until 5pm Tokyo time Thursday.

Short Trade Ideas

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.76 or 109.09.

  • 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 Trade Ideas

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 108.43 or 107.99.

  • 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.

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USD/JPY Analysis

I wrote yesterday that it looked as if the price was quite likely to continue down to hit 108.43 today which would probably be the day’s pivotal point. If it held, I saw the outlook as more bullish; if it broke down, the outlook was more bearish. In any case, I was planning to avoid trading this pair yesterday.

This was a good call overall, ta least enough to stay out of trouble, as the price hardly moved at all over the past 24 hours. None of the levels were touched.

Both currencies are relatively strong. Probably the price will again move little today until the FOMC releases due later, to which this currency pair is usually very sensitive. This could push the price anywhere. A sustained break above 109.07 would be a very bullish sign. There is probably more upside potential than downside.

I take no directional bias on this currency pair today.USDJPYThere is nothing of high importance due today regarding the JPY. Regarding the USD, there will be a release of ADP Non-Farm Employment Change data at 1:15pm London time, followed by the FOMC Statement and Federal Funds Rate at 7pm and the FOMC Press Conference half an hour after that.

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.