USDJPY: 107.50 still supportive
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 to 5pm Tokyo time Friday.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.94 or 108.14.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
Go long following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.50, 107.36, or 107.11.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
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 the support at the major psychological level of 107.50 looked firm. This was likely to be the day’s pivotal point and we would probably see the dominant ranging conditions continue for another day at least. This was a good call as the price has just ranged above 107.50 over the past day.
As the U.S. has a major public holiday today, trading is likely to be very thin and quiet in this currency pair until Tokyo opens later, when we might see a strong move as this often happens after a major holiday session. There is still a ranging environment but I think a bullish bounce at 107.50 might produce a meaningful move up to the 108.00 area so I would take a bullish bias if we get a firm bounce there in the first few hours after Tokyo opens later, until 107.94 is hit.
There is nothing of high importance due today regarding the JPY or the USD. It is a public holiday in the U.S.A.