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 entered between 8am New York time and 5pm Tokyo time, over the next 24 hours.
Short Trade
Short trade entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.48.
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
Long trade entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 106.14 or 105.52.
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 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
Yesterday I repeated that I had a bearish bias below 108.05, and noted this pair was at the heart of the Forex market and had room to fall further. This was and remains a correct approach, and the pair remains in focus. The price made a further strong downwards movement to a new 15-month low price at 106.19, still falling at the time of writing just before the London open. This latest downwards move began with a sell-off following a retracement to the psychologically key 107.50 area, printing a new resistance level there.
All the signs are bearish, except for the price getting very close now to a key support level at 106.14. I would not take a long trade here today unless there is an extremely strong bullish bounce here which would indicate heavy buying. I think it is more likely that the level will not hold.
I maintain a bearish bias and this pair will probably remain at the heart of the Forex market again today.
There is nothing due today concerning the JPY. Regarding the USD, there will be a release of PPI data at 1:30pm London time.