Trade Analysis and Tips for Trading the Japanese Yen

The test of the 157.43 price level occurred at a moment when the MACD indicator had already moved a long way upward from the zero line, which limited the pair's upward potential. For this reason, I did not buy the dollar. A second test of this price level allowed Scenario No. 2 for selling the dollar to be implemented, which resulted in the pair falling by only 7 points.

In the second half of the day, no U.S. economic data releases are expected, which gives buyers an opportunity to try to extend the upward move—especially given the cautious stance of the Bank of Japan. However, one should also take into account unscheduled speeches by representatives of the U.S. Federal Reserve, which could quickly change the current sideways nature of the market. Market sentiment may also be fueled by rumors circulating about future actions by the Bank of Japan. It is important to understand that currency markets are complex and highly changeable mechanisms, where forecasts and expectations have just as much influence as actual economic indicators. Still, the absence of negative news from the United States undoubtedly provides more favorable conditions for the U.S. dollar, which is currently dominating the Japanese yen.

As for the intraday strategy, I will rely more on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy USD/JPY today upon reaching the entry point around 157.58 (the thin green line on the chart), with a growth target at 157.93 (the thicker green line on the chart). At the level of 157.93, I will exit long positions and open short positions in the opposite direction (aiming for a move of 30–35 points in the opposite direction from this level). Further growth of the pair can be expected in continuation of the trend.Important! Before buying, make sure that the MACD indicator is above the zero line and is just starting to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today in the event of two consecutive tests of the 157.32 price level at a moment when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal of the market upward. Growth toward the opposite levels of 157.58 and 157.93 can be expected.

Sell Signal

Scenario No. 1: I plan to sell USD/JPY today after an update of the 157.32 level (the thin red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the 157.04 level, where I will exit short positions and also immediately open long positions in the opposite direction (aiming for a move of 20–25 points in the opposite direction from this level). Pressure on the pair is unlikely to return today.Important! Before selling, make sure that the MACD indicator is below the zero line and is just starting to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today in the event of two consecutive tests of the 157.58 price level at a moment when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal of the market downward. A decline toward the opposite levels of 157.32 and 157.04 can be expected.

What's on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated price where Take Profit orders can be placed or profits can be fixed manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated price where Take Profit orders can be placed or profits can be fixed manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to rely on overbought and oversold zones.

Important. Beginner traders in the Forex market need to be extremely cautious when making decisions about entering the market. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based on the current market situation are an inherently losing strategy for an intraday trader.