Yesterday’s signals were not triggered, as the bullish price action at 111.44 took place before the New York open.

Today’s USD/JPY Signals

Risk 0.75%.

Trades may only be taken from 8am New York time Tuesday until 5pm Tokyo time Wednesday.

Short Trade

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 111.45 or 111.63.

  • Put 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

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 110.60.

  • Put 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 yesterday that the price was looking heavy and a break below the support level at 111.44 looked likely. Once it broke down, I thought we were likely to see a further fall which would probably get at least very close to 111.00. This was a good call as we did get the break, although the move down is slow and only got as far as 111.15.

The picture now is more bearish as the Dollar is weak everywhere and we have new resistance levels at both 111.44 and 111.31. Both look good but 111.31 is too fresh for me to rely upon it here.

I take a cautiously bearish bias here today below 111.31.

USDJPY

There is nothing of high importance due today concerning either the USD or the JPY.

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