USD/JPY Signal Update
Yesterday’s signals produced a spectacularly profitable short trade off the resistance at 111.81 late in the Asian session. There was a pin candle followed by an engulfing candle rejecting that level, both of which broke next bar. If you had taken that trade you will be up about 325 pips, so it should definitely be time to take profit, especially now that the price is sitting on a supportive trend line at around 108.25.
Today’s USD/JPY Signals
Risk 0.75%
Trades may only be taken between 8am New York time and 5pm Tokyo time.
Short Trade 1
* Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.27.
* 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.
Long Trades
* Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 107.82.
* 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
There was a great opportunity just before the Bank of Japan’s release for brave traders when the price action very clearly rejected the resistance level at 111.81. The price has fallen by almost 3% from that level as the Bank signalled it is not planning any further stimulus, which has given a big boost to the Japanese Yen, which is in line with the longer-term bearish trend anyway.
The price has now gone all the way to the supportive trend line linking the multi-month swing lows which occurred in recent weeks. Therefore it is quite likely that it will not fall much further for a while although the action is still extremely bearish. Note there is little support below 107.50.
Regarding the USD, there will be releases of Advance GDP and Unemployment Claims data at 1:30pm London time. There is nothing due concerning the JPY.