USD/JPY Forex Signal

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USDJPY: Major bearish reversal from 109.00

Yesterday’s signals were not triggered, as there was insufficiently bullish price action at 108.79.

Today’s USD/JPY Signals

Risk 0.75%.

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

Short Trade Idea

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.50, 108.79, or 109.00.

  • 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.

  • 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 bullish price action reversal on the H1 time frame immediately upon the next touch of 108.07 or 107.78.

  • 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.

  • 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.

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USD/JPY Analysis

I wrote yesterday that I saw the key thing to watch for as whether the price broke above 109.00 upon the FOMC release and stayed there over the first hour following the release.

Although I was looking to take a long bias, this was a great call insofar as it identified 109.00 as a really key long-term pivotal point. The price failed to hold above that level despite initially spiking as high as 109.30 before falling sharply on long-term selling.

The price is still showing bearish momentum, so today I would look to take a short bias if we get a bearish bounce at any of the key resistance levels identified above following a bullish retracement.USDJPYThere is nothing of high importance scheduled today concerning either the USD or the JPY.

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.