Trade Analysis and Tips for Trading the Japanese Yen

The test of the 146.69 price occurred when the MACD indicator had just started moving downward from the zero mark, which seemed to confirm the correct entry point for selling the dollar. However, as you can see on the chart, the pair did not begin an active downward movement, resulting in losses being locked in. Yesterday's weaker-than-expected composite PMI and services PMI data from Japan triggered a yen sell-off, and despite buyers' attempts to re-enter the market, demand for the dollar remained strong. In the second half of the day, dollar buyers tried to resume the short-term bull market, leveraging good ISM data on U.S. services activity, but they were unsuccessful. There were no significant reports from Japan today, so all attention will shift to the U.S. labor market data later today. Until then, the pair may slightly recover from the sell-off observed during the Asian session. I'll mainly focus on implementing scenarios #1 and #2 for the intraday strategy.

Buy Signal

Scenario #1: Today, I plan to buy USD/JPY upon reaching the entry point around 146.35 (green line on the chart), with a target of rising to the 147.07 level (thicker green line on the chart). At the 147.07 level, I plan to exit the buy position and open a sell position in the opposite direction, aiming for a movement of 30-35 pips in the opposite direction from that level. The pair's rise today can be expected only as part of a correction. Important! Before buying, ensure the MACD indicator is above the zero mark and starting to rise.

Scenario #2: I also plan to buy USD/JPY today in case of two consecutive tests of the 145.88 price when the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to a market reversal upwards. Growth towards the opposite levels of 146.35 and 147.07 can be expected.

Sell Signal

Scenario #1: Today, I plan to sell USD/JPY only after breaking below the 145.88 level (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be the 145.38 level, where I plan to exit the sell position and immediately open a buy position in the opposite direction (anticipating a movement of 20-25 pips in the opposite direction from that level). Pressure on the pair will return in case of weak U.S. data. Important! Before selling, make sure the MACD indicator is below the zero mark and starting to decline from it.

Scenario #2: I also plan to sell USD/JPY today in case of two consecutive tests of the 146.35 price when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a downward market reversal. A decline to the opposite levels of 145.88 and 145.38 can be expected.

What's on the Chart:

Thin green line: Entry price at which you can buy the trading instrument.

Thick green line: The anticipated price where you can set Take Profit or manually lock in profits, as further growth above this level is unlikely.

Thin red line: Entry price at which you can sell the trading instrument.

Thick red line: The anticipated price where you can set Take Profit or manually lock in profits, as further decline below this level is unlikely.

MACD Indicator: When entering the market, it is important to be guided by overbought and oversold zones.

Important: Novice traders in the forex market should be cautious when making market entry decisions. It is best to stay out of the market before the release of important fundamental reports to avoid sudden exchange rate fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. You can quickly lose your entire deposit without stop orders, 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. Spontaneous trading decisions based on the current market situation are initially a losing strategy for an intraday trader.