USD/JPY Forex Signal

Yesterday’s signals were not triggered, as none of the key levels were ever reached.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be taken from 8am New York time to 5pm Tokyo time, during the next 24-hour period.

Short Trade

• Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 112.83.

• Put 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 Trades

• Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 111.94 or 111.66.

• Put 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 the line of least resistance was likely to switch to bullish once the price broke out of its current bearish channel. I would be bullish later if the price could break above the upper channel trend line here, although the U.S. stock market still looks nervous and a strong sell-off there later remains likely to push the Yen up.

This wasn’t a bad call as the price continued to rise after the bullish breakout from the channel, but the rise has faltered and arrived back to where it was some hours ago. Furthermore, the U.S. stock market recovered strongly yesterday but it did not drive the price up here by a great deal, which is not really a bullish sign. For this reason, I am less optimistic about a continued rise here right away, I think the next real test for the bulls is likely to come at the new support level of 111.94 – I would take a bullish bias if we get a strong bullish bounce there.

Regarding the USD, there will be a release of FOMC Meeting Minutes at 7pm London time. Concerning the JPY, the Governor of the Bank of Japan will be speaking at the quarterly Branch Managers meeting at 1:30am.