Not every trader can trade the short time frames intra-day due to commitments so they often look to find the best 1 hour Forex strategy that they can use.
Why the one hour chart?
Because it will give you 24 opportunities to find a trade especially with the usd vs jpy chart. Since the jpy is active after the main Forex pairs slow down in trading volume, it is one of the best Forex strategies for people who work during the day.
USD/JPY 1 Hour Trading Strategy Explained
This is a very simple Asian Session Breakout Forex trading strategy based on price action trading using the 1 hr candlestick chart.
- No indicators are required for this trading strategy
- Focus only on the hourly Forex chart
- Focus only on trading USD/JPY
- Trade only during the Asian trading session – 11 p.m. to 8 a.m. GMT
Here are the trading rules of the this Forex trading system:
- Wait for the first hour candlestick of the Asian Trading Session to close on the USD/JPY currency pair.
- Place 2 separate pending orders: a sell stop and buy stop order on both sides exactly at 2 pips from the low and high respectively.
- Stop loss should be the distance from high to low of that 1 hour candlestick plus 2 pips.
- When one pending order is activated, cancel the other one immediately.
- Aim for a take profit of at least 20 pips.
1 Hour Forex Trading Sell Setup
Here’s an example of a sell trade setup of this USDJPY trading strategy. Please be fully aware that not all of your trades will be this easy.
1 Hour Trading Strategy Buy Setup Example
Here’s a buy trading setup example and again, this is not a 100% winning Forex strategy.
Advantages of the 1 hr USDJPY Forex Trading Strategy
- Simple price action trading system is easy to understand and follow.
- You only have to trade once a day and this minimizes over trading
- One time frame
- One currency pair
- One of the top Forex strategies for people that work full time
Disadvantages of the 1 hr USDJPY Forex Trading Strategy
- Reward to risk ratio is not always great unless you trail your stop
- Asian trading session is sometimes a grind which can cause an almost instant trigger in and trigger out of the trade.
As you can see, hourly trading strategies are not foolproof. They certainly have their upside such as limited screen time but there is no “best” trading strategy. Money management is vital with this strategy just like it is with any other.
The key is to be consistent with trading the 1 hour trading strategy and that also means to stick with trading usd/jpy as many of the other crosses simply range during the Asian session.