USD/JPY Forex Signal: Range Continues

Adam Lemon

USD/JPY: Little going on here between 106.00 and 108.00

Last Thursday’s signals were not triggered as unfortunately the high of the day was just a pip or so short of the resistance level identified at 107.42.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be entered between 8 am New York time Monday and 5 pm Tokyo time Tuesday.

Short Trade Ideas

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.43, 107.76, or 107.87.
  • Put 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.
  • 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 107.10, 106.43, or 106.15.
  • Put 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.
  • 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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USD/JPY Analysis

I wrote last Thursday that there was not much point in trading this pair except fading the extremes of the dominant range between about 106.00 and 108.00 or waiting for a breakout beyond these levels.

I think this was a good call as the price has remained well within this range and just moved sideways in the meantime.

It is hard to find anything useful here to say except there still seems to be no point in doing anything between about 106.00 and 108.00 as nothing has changed.

However, a bullish bounce at 106.43 is starting to look more attractive as the price continues to keep some distance from that area. I am also prepared to take a short trade from a bearish reversal at 107.87.

I do not expect this broad range between 106.00 and 108.00 to be broken today or any time soon.

USD/JPY

There is nothing of high importance scheduled today concerning either the JPY or the USD.

Adam Lemon

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.
Learn more from Adam in his free lessons at FX Academy

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