Yesterday’s signals were not triggered, as the bullish price action at 106.68 was not sufficiently strong, but this support level did hold well.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken between 8am New York time and 5pm Tokyo time, over the next 24-hour period only.
Short Trade
· Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.05.
· 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.
Long Trades
· Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 106.68, 106.44, or 106.13.
· 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.
· 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 I remained bullish above 106.68, and that if 106.68 holds after U.S. data releases, then it will be a bullish sign. This is what happened. The level at 106.68 was the low of the day. The problem for bulls is that the bearish price channel remains, lengthens and strengthens – so we have two contradictory developments with the price. This means traders should be more cautious as the current area of the price is becoming messy and more consolidative. The levels at 106.68 and 106.43 still look like good benchmarks for judging whether bulls or bears are in control, however bulls do need to price to move substantially higher soon. The Yen tends to get a boost when stock markets fall over risk-off sentiment, and this is likely to happen if there is a sustained military clash over Syria involving the U.S. and Russia in any form, news of which could break at any time over the next few days.
There is nothing due today concerning either the JPY or the USD.