Trade Analysis and Tips for Trading the Japanese Yen

The yen continues to surprise with its volatility. The test of the price at 145.64 occurred when the MACD indicator was just starting to move down from the zero mark, confirming the correct entry point for selling the dollar and resulting in a decline of more than 100 points. Buying on the rebound from 144.50, which I highlighted, also resulted in about 30 points of profit. The second half of the day may see dominance by dollar sellers, especially if the US trade balance and the TIPP/RCM Economic Optimism Index show weak data, which would only strengthen investors' concerns about the declining state of the U.S. economy. As for the intraday strategy, I plan to act based on the implementation of scenarios 1 and 2, with a focus on selling the dollar.

Buy Signal

Scenario 1: Today, I plan to buy USD/JPY when it reaches the entry point around 145.30 (green line on the chart) with a target of rising to the level of 146.54 (thicker green line on the chart). At 146.54, I will exit purchases and open sales in the opposite direction, expecting a movement of 30-35 points in the opposite direction from this level. A strong rise in the pair today can only be expected with very strong data and a break above 145.30. Important! Before buying, make sure that the MACD indicator is above the zero mark and just start its rise from it.

Scenario 2: I also plan to buy USD/JPY today in case of two consecutive tests of the price at 144.37, when the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. A rise to the opposite levels of 145.30 and 146.54 can be expected.

Sell Signal

Scenario 1: Today, I plan to sell USD/JPY after breaking the level of 144.37 (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be the level of 143.19, where I will exit sales and immediately open purchases in the opposite direction, expecting a movement of 20-25 points in the opposite direction from this level. Pressure on the pair will return in case of a failed attempt to break above 145.40 and weak U.S. statistics. Important! Before selling, make sure that the MACD indicator is below the zero mark and just starting its decline from it.

Scenario 2: I also plan to sell USD/JPY today in case of two consecutive tests of the price at 145.30, when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a market reversal downwards. A decline to the opposite levels of 144.37 and 143.19 can be expected.

Chart Details:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – presumed price where you can set Take Profit or manually fix profits, as further growth beyond this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – presumed price where you can set Take Profit or manually fix profits, as further decline beyond this level is unlikely;
• MACD Indicator – It is important to be guided by the overbought and oversold zones when entering the market.

Important: Beginner traders in the forex market need to make market entry decisions very carefully. It is best to stay out of the market before the release of important fundamental reports to avoid getting caught in sharp exchange rate fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade in large volumes.

And remember, for successful trading, you need to have a clear trading plan, like the one presented above. Impulsive trading decisions based on the current market situation are initially a losing strategy for an intraday trader.