Yesterday’s signals were not triggered as there was no bullish price action at 111.35.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be entered from 8am New York time until 5pm Tokyo time, during the next 24-hour period only.
Short Trade 1
· Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.35.
· Place the stop loss 1 pip above the local swing high.
· Adjust the stop loss to break even once the trade is 20 pips in profit.
· Remove 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 1
· Go long following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.35.
· Place the stop loss 1 pip below the local swing low.
· Adjust the stop loss to break even once the trade is 20 pips in profit.
· Remove 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
Despite the persistent weakness in the U.S. Dollar, the relative weakness of the Japanese Yen has made it difficult for this pair to fall. There are many trends in the Forex market right now, yet this pair is not trending but ranging above the 111.00 area. This means that if it is to be traded, the best strategy to use is probable an approach of “fading” extreme prices. Considering the current picture, I do not have great confidence in the nearest resistance level of 111.35. Now that the bearish channel has been conclusively broken, it appears more likely than not the price will advance to the 112.00 area over the short term. One advantage of the Yen’s weakness is that this pair can be used to trade the U.S. Dollar long during its periods of retracement within its long-term bearish trend.
There is nothing due today concerning the JPY. Regarding the USD, there will be releases of Core Durable Goods Orders and Unemployment Claims data at 1:30pm London time.