USDJPY: Still bearish below 109.81
Last Thursday’s signals were not triggered, as there was no bullish price action at either 110.11 or 109.81.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered between 8am and 5pm Tokyo time Tuesday.
Short Trades
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.81, 110.11 or 110.36.
Place 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.
Take off 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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.07 or 108.73.
Place 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.
Take off 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 last Thursday that I took no bias on this pair as stock markets were weak and prone to sell off which usually boosts the Yen against the Dollar. Another reason was the lack of any long-term trend plus the position of the price in the middle of a multi-month price range and bullish momentum appearing to be dying.
The price moved down, due mostly to risk-off sentiment dominating the markets as American stocks sold off at the end of the week. However, we have now seen a recovery in that area, but you cannot look at the chart below and feel confidently bullish. For this reason, and due to fact that the trade dispute has still not been resolved, I will stick with looking for short trades from solid bearish reversals, ideally at 109.81, during the later Asian session.
There is nothing of high importance due today concerning either the JPY or the USD. It is a public holiday today in the U.S.A.