Yesterday’s signals were not triggered as the bearish price action took place a little way above the anticipated resistance level of 110.77.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may be taken between 8am New York time and 5pm Tokyo time, over the next 24-hour period only.
Short Trades
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.29 or 111.72.
- 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 109.82.
- 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 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
I have been writing for a while about how this pair is within a long-term, wide swinging consolidation pattern between 109.50 and 114.50. Although there has been a bearish bias and a slight long-term downwards trend, it therefore should not be surprising that the pair is making a move up when the U.S. Dollar starts to strengthen a little. This is quite a good pair to use to take advantage of any Dollar strength, and if the Non-Farm U.S. numbers start to come in strong the price here should go powering up. Alternatively, if the resistance at 110.84 holds, it will be a bearish sign, although I would not look to trade this level today.
There is nothing due today concerning the JPY. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change forecast at 1:15pm London time followed by Crude Oil Inventories at 3pm.