Yesterday’s signals were not triggered, as none of the key levels were ever reached.
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 hours.
Short Trade
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.95, provided there were no hourly candle closes above 111.00 since 8am London time.
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
Go long following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.85.
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 price reaches 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 that the support below at 109.85 is almost confluent with a very big round number (110.00) and so could be an interesting medium to long-term long trade opportunity if reached. Over the short-term, bears could focus on the next touch of the bearish trend line visible in the price chart below. This is still valid as a technical focus, but is now even more sharply so, as the new key resistance level at 110.95 is precisely confluent with the trend line, and has held clearly and cleanly over the past few hours. This is very likely to be a pivotal point today, with a break above being a bullish sign likely to indicate a reversion to the long-term ranging conditions which have dominated this pair’s price movement. Alternatively, if it holds until New York opens and then turns clearly bearish rejecting the level, it is likely we will see a continuation of the downwards movement. Looking to the longer term, this entire price area is interesting, as it is close to 110.00 which is psychologically important and might provide a long-term low, so a medium or long-term long trade opportunity might arise. I have no directional bias, there might be either a long or short opportunity today, or even both.
There is nothing important due today concerning either the JPY or the USD.