Yesterday’s signals were not triggered, as there was no bullish price action at either 106.10 or 105.90.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken between 8am New York time and 5pm Tokyo time, during 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 106.13.
· 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 106.10, 105.90, or 105.26.
· 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
Yesterday I took a bullish bias, due to the break above the bearish trend line and the holding of the price above higher support levels such as 106.10. This worked out OK yesterday as the price continued to rise, until there was a strong stock market reaction to the announcement of Chinese tariffs on American goods. The Yen tends to strengthen when strongly “risk-off” events occur in the U.S. financial market and this is what happened here as the pair fell sharply, invalidating former support. The support around 106.10 has now flipped to become probable resistance. Today’s action is likely to be determined by whether 106.13 holds, so I have a bearish bias below that level and a bullish bias above it.
There is nothing due today concerning either the JPY or the USD.