Technical analysis and trading recommendations for the USD/JPY currency pair for January 7

4-hour timeframe

The total picture:
Sale signal canceled and purchase signal set. For now, opening positions is not recommended because Tenkan-sen and Kijun-sen have not diverged yet. As soon as it appears, it is recommended to open long positions with the target at 93.71. In case of the price strengthening lower than Kijun-sen purchase signal will weaken and it is recommended to cut long positions. Bollinger Bands are demonstrating the sideward movement, the Bands are side-directed that signals about flat, and when the price comes closer to the upper Bollinger Band it is needed to keep watch on its behavior as a rebound can happen. MACD is quite the opposite moving up that means the upward movement.
Trading recommendations:
As for now, it is recommended to wait for the situation clearing. In case of Tenkan-sen and Kijun-sen diverging target will be at 93.71 level. Stop loss should be set at 92.20.
The picture clarification:

Ishimoku indicator:
Tenkan-sen — red line
Kijun-sen — blue line
Senkou Span A — light brown stipple line
Senkou Span B — light purple stipple line
Chinkou Span — green line
Bollinger Bands indicator:
3 yellow lines
MACD indicator:
The red line and the histogram with the white bars in the indicators window.
Good luck in trading,
Stanislav Polyanskiy
January 7, 2010