USD/JPY Signal Update
Yesterday’s signals were not triggered.
Today’s USD/JPY Signals
Risk 0.25% on either or both recommended trades.
Entry should be made before 8am tomorrow morning London time
Long Trade 1
Enter long at the next bar break of an hourly pin or strong outside bar rejecting and closing above all of 102.21, the S1 daily pivot, and the lower bullish channel trend line. If all these levels are not touched and rejected by the same hourly bar, or if an hourly bar closes more than a few pips below any of these levels, the trade is immediately invalidated and should not be taken.
Stop loss at the local swing low or 101.88, depending upon how close the entry is to 102.21. If the entry is very close, then the lower of the two should definitely be used.
Take profit on 90% of the position at 102.85, move the stop loss to break even, and leave the rest to ride.
Long Trade 2
If the price touches 101.65 enter long with a limit order there.
The initial stop loss should be 101.20 but could be moved up if the price moves right possibly with a trailing stop.
Take 90% of the position as profit at the first touch of the (by then) broken bullish ascending trend line and move the stop loss to break even at this point if you have not already done so, leaving the rest to ride.
USD/JPY Analysis
A whole slew of important US economic data is expected at 1:30pm London time today, therefore this pair is likely to be most active around that time.
The broad outlook shows that this pair, which has been in a strong uptrend, may not be trending up strongly and did make a triple top recently, but is still contained within a long-term bullish channel which has held for about a month now:
Following the bearish triple top and two bearish daily outside candles recently, it looked like this pair was set for a fall, which was why I highlighted a possible short trade yesterday. The price did break the daily low but had not come back to test local resistance yet at around 102.90, so the trade's conditions were not met.
Taking a closer look at the recent chart action, we can actually see some bullish signs:
The price failed to really break down after two bearish outside bars on the daily chart.
The lower trend line held at (2) yesterday with a bullish pin bar, rejecting
The new resistance turned into support level at 102.20, which is above the previous level formed at 101.65.
Therefore I am looking to highlight as signals possible long trades only, at both of the support levels identified with blue lines in the above chart.