USD/JPY Daily Price Forecast – 7th January 2025

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Trade Summary:

USDJPY
Sell Stop @ 157.339
TP @ 156.726
SL @ 158.462

USD/JPY Analysis (H4 Chart)

The chart indicates a short trade setup with the following key levels:

• Sell-Stop Entry: 157.339

  • The price is close to this level, and momentum confirms the trade. A candlestick confirmation is awaited to validate the entry.

• Take Profit (TP): 156.726

  • This is the target level for the short trade, suggesting a bearish move if the sell-stop is triggered.

• Stop Loss (SL): 158.462

  • The stop loss is placed above the recent highs, providing a risk buffer in case of a reversal.

Technical Observations:

• Moving Averages:

  • The chart shows three moving averages (blue, red, and green), which indicate the overall trend. The price is currently near the green moving average, suggesting a potential pivot point.

  • The blue moving average (likely a longer-term trend indicator) is below the price, indicating a bullish longer-term trend, but the short-term setup is bearish.

• Momentum:

  • Momentum is confirmed for the short trade, but the candlestick confirmation is still pending. This suggests traders should wait for a clear signal before entering.

• Round Levels:

  • The price is near the round level of 157.000, which could act as psychological support or resistance.

Summary:

The USD/JPY pair is showing a potential bearish setup with a sell-stop at 157.339, targeting 156.726. However, traders should wait for candlestick confirmation before entering the trade. The stop loss at 158.462 ensures risk management in case of a bullish breakout.

Recommended Lot Size

Trading is all about statistics.

While we can experience winning streaks, we can also suffer from losing streaks.

As such, we should always size each trade to withstand losing streaks (if any).

It's widely recommended that you should not risk more than 2% of your capital for each trade.

We believe it's easier to control your lot size by limiting your lot sizing to 0.01 for every $500 in your account.

So if you have $5000, then risk no more than 0.10 lot size per trade.

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If you spot a mistake especially when it comes to the price, please use common sense and check the chart.

We wish you good luck and good profit for this trade idea.

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