Yesterday’s signals produced a nicely profitable short trade following the bearish pin candle rejecting the resistance level identified at 110.94. It looks as if this position might have further to run.
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 Trades
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.24 or 110.94.
- 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 bullish price action reversal on the H1 time frame immediately upon the next touch of 109.43.
- 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
The FOMC release produced a sharp move down from a topping out at the resistance level of 110.84. Previous technical formations have been broken and we now seem to have the end of what was just a deep pull back in a long-term bearish trend, with a resumption of the trend. The old channel has almost certainly lost its importance, so the major technical feature near the current price is a support level at 109.243. There is certainly a more bearish outlook overall
There is nothing due today concerning the JPY. Regarding the USD, there will be a release of Unemployment Claims data at 1:30pm London time.