USDJPY: Bullish break but 108.73 holds
Last Thursday’s signals were not triggered, as there was no bearish price action at either 108.48 or 108.73.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered from 8am New York time Monday until 5pm Tokyo time Tuesday.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.73 or 109.09.
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 Ideas
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 108.43 or 107.99.
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 Thursday that the action here was thin and looked unpredictable. I wanted to avoid trading this currency pair for the time being.
It would have been better if I had put more faith in bulls pushing up the price. The break of the former resistance just below 108.50 is significant. The price is still in a relatively congested area through, and the resistance at 108.73 has been tested and held. If the price can break above that now and challenge 109.09 it would be a bullish sign, and a sustained break above 109.07 would be a very bullish sign. The Dollar is strong, but the Yen is not currently one of the weaker currencies. Markets will be looking to the Bank of Japan’s monthly policy release later which could cause surprising price movement, so we could see this pair really start to come back to life now. It is worth keeping an eye on this currency pair and I prefer to look for long rather than short trades.
There is nothing of high importance due today regarding the USD. Concerning the JPY, the Bank of Japan will be releasing its towards the end of the Tokyo session later.