USDJPY: Strongly Bullish
Yesterday’s signals were not triggered, as there was no bearish price action at any of the several resistance levels which were hit.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be taken from 8am New York time Thursday until 5pm Tokyo time Friday.
Short Trade Idea
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 109.96.
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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.00 or 108.62.
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 yesterday that risk sentiment was recovering and so I was ready to take a bullish bias if we had gotten three consecutive hourly closes after New York opened above 108.64. We did, and this was a great call because we now have about 80 pips of long profit since that moment arrived yesterday.
This bullish thrust is very strong, and the S&P 500 Index is making new all-time highs which suggests that this pair is likely to rise higher. However, bulls should be concerned that the price is again approaching the long-term area of strong resistance between about 109.50 and 110.00.
I would be happy to take another long trade if we get a pullback to support and a firm bullish bounce there. I expect still higher prices, but we may well see another bearish failure before 110.00 is broke.
There is nothing of high importance due today regarding either the JPY or the USD.