USDJPY: Bulls failing at 108.71
Yesterday’s signals were not triggered, as none of the key levels were reached during the specified time.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken from 8am New York time Tuesday and 5pm Tokyo time Wednesday.
Short Trades
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.71 or 109.07.
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 107.50.
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 there had been a recovery in the USD, and this had pushed the price up after the bottoming near 108.00. However, the next resistance level at 108.71 had continued to hold, so I thought that we may well see a further downwards movement over the coming hours.
A sustained break above 108.71 would have been a bullish sign.
This was a pretty good call, but neither scenario has really played out. The only change is a new support level, but I feel it may be weak as it is within a weekend price gap which is quite likely to get filled.
There is a long-term bearish trend, but the market is quiet, and we have seen a bottoming out for several days, so probably if the price can trade for a couple of hours above 108.71, it will be likely to go higher still.
There is nothing important due today concerning either the USD or the JPY.