USDJPY: Ranging between 107.50 and 108.75
Last Thursday’s signals were not triggered, as there was no bearish price action at 107.94.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be entered prior to 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 108.75 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 Ideas
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 108.28, 108.14, 108.06, or 107.94.
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 there was still a ranging environment, but I thought that a bullish bounce at 107.50 might produce a meaningful move up to the 108.00 area so I was ready to take a bullish bias if that had happened, until 107.94 is hit. This was a relatively good call, as the price got to a low about 5 pips away from 107.50 before rising strongly.
We basically have a ranging, trendless environment in this currency pair, between about 107.50 and 108.75. This would indicate fading the extremes of this range, but with the U.S. stock market making a new all-time high price last week, I am more inclined to be bullish on this pair, so I see bounces at support levels as likely to be the best option. We have a new higher support level at 108.28 which has given a strong bounce.
If the price can gest established above 108.75 later, that would be a very bullish sign.
There is nothing of high importance due today regarding the JPY or the USD.