Yesterday’s signals were not triggered as there was no bearish price action at either of the potential short entry trigger points.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be taken between 8am New York time and 5pm Tokyo time, over the next 24-hour period.
Short Trades
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 112.36 or 112.85.
- Put the stop loss 1 pip above the local swing high.
- 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 ride.
Long Trade 1
- Long entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.35.
- 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 ride.
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
There has been a significant development over the past 24 hours: the bullish breakout above the upper trend line of the medium-term bearish channel, and the flipping of obvious resistance to obvious support at approximately 111.35. These are clearly bullish signs, but the long-term picture shows a consolidating, wide range pattern being formed over the past few months. There is no trend in this pair, so the best way to trade it looks to be both long and short, at rejections of extreme support and resistance areas. It looks as if a boost to the USD will produce a stronger upwards move than the converse would produce a downwards move.
There is nothing due today concerning the JPY. Regarding the USD, there will be a release of Crude Oil Inventories data at 3pm London time, followed by the FOMC Statement and Federal Funds Rate at 7pm.