Yesterday’s signals were not triggered, as there was no bullish price action at 105.94.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered from 8am New York time to 5pm Tokyo time, during the next 24-hour period.
Short Trades
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 105.86 or 106.44.
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.
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 that as there was no news due we were quite likely to just see a consolidation within this price area over the next 24 hours, so I has no directional bias. This worked out well as the price began to fall from the new resistance level at 106.44 but turned around sharply and rose to test the level again, where it failed. It has fallen from there and printed new lower resistance at 105.86 but is now showing signs of rising. The short-term picture is somewhat confusing, yet the medium and long-term pictures are definitively bearish, and the price chart below is dominated by steepening medium-term bearish trend lines. There is buying close to 105.00 where the price does not want to break down further, so bears may need to be cautious. I take a cautiously bearish bias on this pair today.
There is nothing due today concerning the JPY. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change at 1:15pm London time, followed by Crude Oil Inventories at 3:30pm.