USD/JPY Forex Signal – 04 June 2018

Last Thursday’s signals were not triggered, as neither of the key levels were reached that day.

Today’s USD/JPY Signals

Risk 0.75%.

Trades must be taken between 8am New York time and 5pm Tokyo time, over the next 24-hour period only.

Short Trade

• Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 110.40.

• 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.

• Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.

Long Trades

• Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 109.07 or 108.05.

• 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.

• Take off 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 last Thursday that I had no directional bias, and I would stand aside from this pair. This was a good call, as this pair just consolidated that day. However, since then it has broken strongly above 109.00, forming a new obvious support level at 109.07. There is a reasonably long-term bullish trend, so we should be close to a situation where it would make sense to take a bullish bias. The problem is that the area around the big round number at 110.00, although not a key pivotal point, seems likely to halt any advance, at least for a while. This means that the upside potential is probably limited, although a strongly bullish bounce at a retracement to 109.07 could be an interesting long trade entry later.

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