Yesterday’s signals were not triggered, as there was insufficiently bearish price action at 112.30.
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 Trade
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 113.28.
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 Trades
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 112.35 or 111.70.
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
I wrote yesterday about how trading this pair has been a challenge lately. The price has turned bullish again over recent hours, printing a possible new support level at 112.35. The momentum is with the bulls, but only weakly so, and this might turn. This pair is becoming more alive, with gradually increasing volatility, and it is probable that the best way to trade it will be to not worry much about the long-term bullish trend, but instead just seek to trade the convincing price turns by getting in early and riding the waves. I have no strong directional bias, but I do see the bulls as more likely to prevail over the short-term.
There is nothing important due today concerning the JPY. Regarding the USD, there will be a release of Unemployment Claims data at 1:30pm London time.