USD/JPY: Weakly bullish with low volatility
Yesterday’s signals were not triggered, as none of the key levels were reached.
Today’s USD/JPY Signals
Risk 0.75%.
Trades must be entered from 8am New York time Tuesday to 5pm Tokyo time Wednesday.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 108.04, 108.21, or 108.59.
Place 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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of the lower price channel trend line shown in the price chart below which is currently sitting at about 107.48, or 107.63.
Place 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 it looked as if the price was going to continue drifting upwards, although action should be very quiet until the Asian session. This was a good call as the price has moved a little higher over the past day.
Volatility is low and the technical situation is unchanged: weakly bullish, due to the symmetrical price channel shown in the price chart below.
Risk assets are stronger while safe havens such as the Japanese Yen and the U.S. Dollar are weak, but the Yen is weaker than the Dollar which explains why the price is drifting up here.
The outlook is bullish, but we may well see a bearish reversal if the resistance at 108.04 is hit later, as this level has been strong resistance for some time.
There is nothing of high importance due today concerning either the JPY or the USD.