USD/JPY Signal Update
Yesterday’s signal was not triggered and expired.
Today’s USD/JPY Signal
Risk 0.50%.
Entry should be made before 8am tomorrow London time during either the London, New York, or Tokyo trading sessions.
Short Trade 1
Enter short on a next bar break after a pin or engulfing par rejects the level of 103.85, at 1 pip above the high of that rejecting pin or engulfing bar. Once a bar closes above 103.90, or more than 1 bar closes above 103.85, do not take the trade.
Move the stop to break even when the trade is 40 pips in profit. Take 50% of the profit at 102.55.
Long Trade 1
Enter long on a next bar break after a pin or engulfing par rejects the level of 101.63, at 1 pip below the low of that rejecting pin or engulfing bar. Once a bar closes below 101.50, or more than 1 bar closes above 101.63, do not take the trade.
Move the stop to break even when the trade is 40 pips in profit. Take 50% of the position as profit at 102.10.
USD/JPY Analysis
The hangover from Friday’s Non-Farm Payroll data must have continued, as the USD was hammered Monday at the expense of the JPY, which strengthened. The fall was sharp enough not to leave any more obvious points for entry on a pull-back, so we are left with 103.85 as a likely candidate. There is now no reason to expect the strengthening of the JPY to stop just yet. There has already been a retest and rejection of the broken bullish trend line.
There is likely to be some support at the key psychological number of 102.50.
The next really good support level is at 101.63, which has acted as both resistance and then support. If this level is reached over the next 24 hours is pretty likely to see a lot of profit-taking by shorts, and so should provide us with at least a tradable bounce and possible even a resumption of the upwards trend:
There is no important news due today for the JPY. Concerning the USD, there are two news releases due at 1:30pm London time (Core Retail Sales / Retail Sales) so there is likely to be more movement during the New York session than the London session.