USD/JPY Forex Signal: Still Ranging

Adam Lemon

Both currencies are tending to move in tandem with high positive correlation, as both have the main function of acting as safe havens, which are tending now to either rise or fall together.

USD/JPY: Flat between 106.00 and 108.00

Yesterday’s signals could have produced a losing long trade from the bounce at the support level at 107.10; I did make clear that I was not interested in looking to take any trade from this level.

Today’s USD/JPY Signals

Risk 0.75%.

Trades may only be taken from 8 am New York time Tuesday until 5 pm Tokyo time Wednesday.

Short Trade Ideas

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.43, 107.76, or 107.87.
  • Place 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.
  • 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 107.10, 106.43, or 106.15.
  • Place 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.
  • 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.

Advertisement
The yen is a popular asset during turbulent times.

USD/JPY Analysis

I wrote yesterday that it was hard to find anything useful here to say except there still seemed to be no point in doing anything between about 106.00 and 108.00 as nothing had changed.

This was a good call as the price has gone nowhere, as I expected, and although all the levels I have identified have continued to hold very precisely, as can be seen in the unaltered price chart below, the profits are so small this is no real use to any traders except maybe scalpers.

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

I hold to exactly the same analysis that I set out yesterday, as there has been no material change in this pair’s situation. Both currencies are tending to move in tandem with high positive correlation, as both have the main function of acting as safe havens, which are tending now to either rise or fall together.

I have no directional bias.

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

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.