USDJPY: Wide swings within long-term price range
Yesterday’s signals were not triggered, as there was no bullish price action at either 108.63 or 108.28.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm Tokyo time Friday.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.28 or 108.48.
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.
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 Trade Ideas
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 107.89 or 107.50.
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.
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 yesterday that the situation was very unpredictable due to the upcoming FOMC release. I thought the best opportunity would be a post-release spike up to 109.07 or higher giving a short trade opportunity. This did not happen, but the release did weaken the Dollar considerably, and the Yen gained against it just like everything else.
The price is moving in wide swings well within its long-term range, so I do not see any exception opportunities ahead or reasons to focus on this currency pair. The best approach will most likely be scalping reversals at key levels for conservative profit targets.
There is nothing of high importance due today regarding the JPY. Concerning the USD, there will be a release of CPI (Inflation) data at 1:30pm London time today, followed by testimony from the Chair of the Federal Reserve before the Senate at 3pm.