Yesterday’s signals were not triggered, as there was no bearish price action when 108.50 and 108.79 were reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered between 8am New York time Tuesday and 5pm Tokyo time Wednesday.
Short Trade Idea
⦁ Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.00 or 109.48.
⦁ 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 108.75, 108.65, or 108.30.
⦁ 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.
USD/JPY Analysis
I wrote yesterday that although we were seeing bullish signs, and the bullish case for this currency pair was strengthened by the fact that the S&P 500 stock index was rising to hit new all-time highs, which typically pulls this currency pair along with it, I saw the price here as evenly balanced between 108.30 and 108.50 with no clear direction ahead. This was not a great call I should have taken more faith from the bullish signs I mentioned.
The picture is now considerably more bullish, and it seems as if the bulls are again going to drive the price up to test this long-term pivotal round number at 109.00 which is close by. We already have a long-term triple top there. A bullish breakout above 109.00 could be explosive as it has been building up for a long time. Alternatively, another failure there could see a medium-term downwards move of perhaps 200 pips, so it is a pivotal point worth watching.
I would take a bullish bias on this pair later if New York closes today above 109.00.
There is nothing of high importance due today concerning the JPY. Regarding the USD, there will be a release of ISM Non-Manufacturing PMI data at 3pm London time.