USD/JPY: Long-term bullish breakout above 110.00
Yesterday’s signals were not triggered, as there was no bearish price action when the resistance level at 109.96 was first reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken from 8am New York time Tuesday and 5pm Tokyo time Wednesday.
Short Trade Idea
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.69.
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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.18 or 109.00.
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 with the return of risk-on sentiment it may be that we finally get a major long-term breakout here above 110.00 which would be a very bullish sign. I said that I was ready to take a strongly bullish bias when we got a New York close above 110.00.
This was a good call and we got the breakout above 110.00, however the rise is happening very slowly, although the price action still looks bullish.
It seems that the former resistance at 109.96 has flipped to become new higher support confluent with the big round number / psychological level at 110.00 – this is a bullish sign.
I am bullish as long as the price continues to mostly trade above 109.96 and I expect higher prices later as risk sentiment continues to improve.
If the USA and China announce an agreement on a trade deal soon, we can expect the price here to rise strongly and probably even reach the next resistance level at 110.69.
I take a bullish bias above 109.96.
There is nothing of high importance due today regarding the JPY. Concerning the USD, there will be a release of CPI data at 1:30pm London time.