USD/JPY: Flat as both currencies act as safe havens
Yesterday’s signals were not triggered as there was no bearish price action when the resistance level identified at 107.10 was first reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be taken from 8 am New York time Thursday until 5 pm Tokyo time Friday.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.24, 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 107.09, 106.87, 106.70, 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.
USD/JPY Analysis
I wrote yesterday that a break below 106.70 would be a bearish sign as it had already been significantly touched three times. The resistance at 107.43 remained crucial, probably because it was confluent with the major psychological quarter-level at 107.50.
I said that I would be happy to trade reversals from either of those two levels.
However, nothing happened, the price continues to go backwards and forwards and the range over the past day was even narrower than is typical, despite all the movement we have seen by the U.S. Dollar against other currencies.
My analysis today remains exactly the same as yesterday. 106.70 and 107.43 remain levels of interest, but all traders except scalpers will probably do well to ignore anything else.
This pair is so dull because both the Dollar and the Yen are moving together, strengthening on risk aversion, and weakening when risk-on sentiment increases, as has done over the past few days.
There is nothing of high importance scheduled today concerning either the JPY or the USD.