Yesterday’s signals were not triggered as there was no bullish price action at 112.57.
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 112.66 or 113.05.
Place the stop loss 1 pip above the local swing high.
Adjust 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 ride.
Long Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 112.19 or 111.43.
Place the stop loss 1 pip below the local swing low.
Adjust 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 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
I wrote yesterday that we had a medium-term downward trend, but it was also true that the nearby support is confluent with the psychologically important level at 112.50, so a bullish bounce here could be an interesting long trade opportunity. This wasn’t a bad call as the price continued to fall and did not respect that level, which is a bearish sign. The Japanese Yen has gained as the U.S. stock market fell sharply and money flowed into safe havens. The price is now approaching an area which has been long-term support. There is a longer-term ranging environment, so I think this pair is very unpredictable and dangerous to trade right now. I have no directional bias.
There is nothing important due today concerning either the JPY or the USD.