Trade analysis and tips for trading the Japanese yen
The price test at 155.58 occurred when the MACD had significantly dropped below the zero mark, limiting the pair's further downward potential. For this reason, I did not sell the dollar, and I was right. There was no downward movement, and trading continued within a sideways channel. Considering that no important statistics are expected in the second half of the day and the speech by FOMC member Christopher Waller is unlikely to have a decisive impact on the market, it is best to focus on the further development of the upward trend in the pair, taking advantage of pullbacks, which are quite likely due to interventions by the Bank of Japan. As for the intraday strategy, I plan to act based on implementing Scenarios 1 and 2.
Buy Signal
Scenario 1: Today, I plan to buy USD/JPY upon reaching the entry point around 155.87 (green line on the chart), with a target of rising to the 156.47 level (thicker green line on the chart). At around 156.47, I will exit purchases and open sales in the opposite direction (aiming for a movement of 30-35 points in the opposite direction from the level). Today, you can expect the pair to rise to continue the trend, but strong movement is unlikely. 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 155.48 price when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. You can expect a rise to the opposite levels of 155.87 and 156.47.
Sell Signal
Scenario 1: Today, I plan to sell USD/JPY after the level of 155.48 is updated (red line on the chart), leading to a rapid decline in the pair. The key target for sellers will be the 154.83 level, where I will exit sales and immediately open purchases in the opposite direction (aiming for a movement of 20–25 points in the opposite direction from the level). Pressure on the pair will return in case of failure to consolidate around the daily maximum. Important! Before selling, please ensure the MACD indicator is below the zero mark and starting to decline.
Scenario 2: I also plan to sell USD/JPY today in case of two consecutive tests of the 155.87 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. You can expect a decline to the opposite levels of 155.48 and 154.83.
Chart Explanation:
- Thin green line: Entry price for buying the trading instrument.
- Thick green line: Estimated price for setting Take Profit or manually fixing profits, as further growth above this level is unlikely.
- Thin red line: Entry price for selling the trading instrument.
- Thick red line: Estimated price for setting Take Profit or manually fixing profits, as further decline below this level is unlikely.
- MACD Indicator: When entering the market, following overbought and oversold zones is important.
Important: Beginner traders in the forex market should be cautious when making entry decisions. To avoid sharp price fluctuations, staying out of the market before important fundamental reports are released is best. 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.
Remember, successful trading requires a clear plan like the one presented above. Spontaneous trading decisions based on the current market situation are initially losing strategies for intraday traders.
