USD/JPY: Close to 9-month high price at 110.28
Yesterday’s signals were not triggered, as there was insufficiently bearish price action at either of the resistance levels which were reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered between 8am New York time Wednesday and 5pm Tokyo time Thursday.
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 110.12, 109.95, or 109.54, 109.25.
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 I thought the best approach here would be to fade any failed bullish breakout which touched 110.12 but where the price quickly got back down to a level below 109.95, or to take a bullish bias following a New York close above 110.18. Neither of these scenarios played out yesterday.
We saw a bullish tilt at the swing high at 110.12 during the Asian session, then as the London session got underway the price broke bullishly above that level, and at the time of writing is threatening the 9-month high price at 110.28. These are significantly bullish technical developments and will create a more bullish picture if the price can hold up over the rest of today.
I will take a bullish bias later if we get a New York close above 110.18, but I note there will be an FOMC meeting minutes release later in the New York session and the price of this currency pair is likely to be sensitive to any surprise there.
Concerning the USD, there will be a release of FOMC Meeting Minutes at 7pm London time. There is nothing of high importance due today regarding the JPY.