USD/JPY Forex Signal: Bullish Consolidation

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USD/JPY: Yen getting weaker over time

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 entered from 8am New York time Tuesday to 5pm Tokyo time Wednesday.

Short Trade Ideas

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.82, 112.40, or 112.93.

  • 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.

  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

Long Trade Ideas

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.49 or 108.50.

  • 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.

  • Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

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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The yen is a popular asset during turbulent times.

USD/JPY Analysis

I wrote yesterday that I thought it was not wise to be short the USD these days against anything, so I expected this weak bullish trend to continue here, and I would be prepared to take long trades from any firm bullish bounces at any support level which may be reached.

We are seeing a bit of a pullback by the USD, but the only effect that is having here is to make the price consolidate, and it is still a bullish consolidation. I see the USD as likely to strengthen further over the medium term, so I continue to take a weakly bullish bias if the price bounces at any of the identified support levels – I would not take any short trades yet. Volatility here is relatively low compared to other USD currency pairs.USDJPYRegarding the USD, there will be a release of Flash Manufacturing PMI data at 1:45pm London time. There is nothing of high importance scheduled today for 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.
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