Last Wednesday’s signals were not triggered as there was no bearish price action at 113.05.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be entered from 8am New York time until 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 113.66.
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 Trades
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 113.14 or 112.75.
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 last Wednesday that we seemed to have begun a short-term bullish trend, breaking above the former resistance level at 112.66 and then using it as new, higher support. I still saw this pair as generally dangerous to trade due to the ranging environment which prevailed. I was correct insofar as the price went on to make generally higher prices, although not by a lot.
The situation now looks more bullish, with a medium-term bullish price channel and new higher support at 113.14. If there no more sharp drops in stock markets, it seems likely that the price will rise from here. I take a cautiously bullish bias above 113.40.
There is nothing important due today concerning either the JPY or the USD.