USD/JPY Signal Update
Yesterday’s signals expired without being triggered.
Today’s USD/JPY Signals
Risk 0.50%
Trades must be taken from 8am New York time until 5pm Tokyo time only.
Long Trade 1
* Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 113.98.
* Put 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.
Short Trade 1
* Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 115.54.
* Put 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.
Short Trade 2
* Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 116.09.
* Put 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.
USD/JPY Analysis
This pair looks interesting as it has been consolidating tighter and tighter over the past few days. This kind of set-up suggests that there is going to be a break out of some force. What often happens in these kind of situations is there is a fake breakout on one side of the zone, followed by a strong, real breakout the other side of the zone. As this pair has fallen fast and hard but seems to be finding support at around 114.00, it would not surprise me if Yellen’s testimony later will lift the USD and trigger a meaningful bullish move in this pair. However certain levels above, particularly near 116, are quite likely to act as resistance into which any bullish move will quickly fade.
It is a public holiday today in Japan. Regarding the USD, the Chair of the Federal Reserve will be testifying before Congress at 3pm London time, followed later by Crude Oil Inventories at 3:30pm.