USDJPY: Bears looking to test key 107.46 pivotal point
Last Thursday’s signals were not triggered, as none of the key levels were reached during that day’s session.
Today’s USD/JPY Signals
Risk 0.75%.
Trades may only be taken from 8am New York time Monday until 5pm Tokyo time Tuesday.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 107.77 or 108.06.
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.
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 107.26, 107.21, or 106.72.
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.
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 would keep looking for short trades from areas above 108.43 as the medium-term upwards trend still seems to be valid, but not strong enough to break above this pivotal zone of long-term resistance.
It was not possible to profit from this call as the price never got that high again, but I was right about looking towards the short side here.
The technical picture is more bearish as we are getting clear steps down. The price is now sitting on a very pivotal support level at 107.46. I think if this level holds into the New York session and we start to get a bullish turn, then it would be a sign that a long trade from that level has become a good idea. I would be inclined to be more bearish on this pair if the price can get established below 107.21 later on.
There is nothing of high importance due today concerning the USD. Regarding the JPY, the Governor of the Bank of Japan will be giving a minor speech at 6:30am London time.