Trade Analysis and Advice for Trading the Japanese Yen
The price test at 142.37 occurred when the MACD indicator began to move down from the zero mark, confirming the correct entry point for selling the dollar, in line with the recent ongoing downward trend. As a result, the pair dropped by more than 30 pips, but we only reached the target level of 141.50 today during the Asian session. Strong data on Japan's industrial production for August put even more pressure on the dollar, maintaining hope for continuing the downtrend. However, one should be cautious when selling at the current lows. It's better to wait for a slight correction before opening new short positions. As for the intraday strategy, I will rely more on the realization of scenarios No. 1 and 2.
Buy Signal
Scenario No. 1: Today, I plan to buy USD/JPY upon reaching the entry point around 141.51 (green line on the chart), aiming for a rise to the level of 142.55 (thicker green line on the chart). At 142.55, I plan to exit the long position and open a short position, expecting a movement of 30-35 pips in the opposite direction from this level. Today's rise in the pair can only be considered part of a correction. Important! Before buying, ensure the MACD indicator is above the zero mark and 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 price at 140.61 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. A rise toward the levels of 141.51 and 142.55 can be expected.
Sell Signal
Scenario No. 1: I plan to sell USD/JPY today only after testing the level of 140.61 (red line on the chart), leading to a rapid decline in the pair. The key target for sellers will be the 139.56 level, where I plan to exit the short position and immediately open a long position (expecting a movement of 20-25 pips in the opposite direction from this level). Pressure on the pair can return anytime, as the bearish market for the dollar hasn't gone away. Important! Before selling, make sure that the MACD indicator is below the zero mark and just starting to decline.
Scenario No. 2: I also plan to sell USD/JPY today if there are two consecutive tests of the 141.51 price when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. A decline to the opposite levels of 140.61 and 139.56 can be expected.
What's on the Chart:
Thin green line: the entry price at which you can buy the trading instrument.
Thick green line: the estimated price at which you can set Take Profit or manually close positions, as further growth above this level is unlikely.
Thin red line: the entry price at which you can sell the trading instrument.
Thick red line: an estimated price at which you can place Take Profit or manually close positions, as further decline below this level is unlikely.
MACD indicator: when entering the market, it is essential to be guided by overbought and oversold zones.
Important: Novice traders in the forex market need to be very careful when making decisions about entering the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You must set stop orders to avoid losing your entire deposit, especially if you don't use money management and trade in large volumes.
Remember, a clear trading plan, like the one I've outlined, is essential for successful trading. Making impulsive decisions based on the current market situation is a losing strategy for novice intraday traders.
