Analysis of Trades and Tips for Trading the Japanese Yen
The test of the 145.56 price level occurred when the MACD indicator was just beginning to move upward from the zero line, confirming the correct entry point for buying the dollar. As a result, we observed the pair rise towards the target level of 146.13, allowing for a profit of over 50 points. The second half of the day may also be dominated by dollar buyers, but this will depend on whether the U.S. Manufacturing PMI and Services PMI data for August exceed economists' expectations. A return to growth in U.S. manufacturing activity in August would provide a good reason to buy the dollar. Jerome Powell's speech tomorrow could potentially steer the market back towards a bearish trend. Regarding the intraday strategy, I plan to act based on the implementation of Scenarios 1 and 2.
Buy Signal
Scenario 1: Today, I plan to buy USD/JPY if the price reaches around 146.17 (green line on the chart) with a target of 146.65. At 146.65, I will close my buy positions and open sell positions, targeting a 30-35 point movement in the opposite direction from this level. Counting on the pair's growth today is only feasible if the U.S. data is strong and buyers remain active near yesterday's high. Important! Before buying, ensure that the MACD indicator is above the zero line and just beginning its upward movement.
Scenario 2: I also plan to buy USD/JPY today if there are two consecutive tests of the 145.75 price level when the MACD indicator is in the oversold area. This will limit the pair's potential for further decline and lead to a market reversal upwards. The expected rise would target the opposite levels of 146.17 and 146.65.
Sell Signal
Scenario 1: I plan to sell USD/JPY today if the price drops below 145.75 (red line on the chart), leading to a quick decline in the pair. The key target for sellers will be the 145.27 level, where I plan to close my sell positions and immediately buy USD/JPY in the opposite direction, aiming for a 20-25 point movement in the opposite direction from this level. Pressure on the pair will return in case of weak PMI data. Important! Before selling, ensure that the MACD indicator is below the zero line and just beginning its downward movement.
Scenario 2: I also plan to sell USD/JPY today if there are two consecutive tests of the 146.17 price level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. The expected decline would target the opposite levels of 145.75 and 145.27.
What's on the chart:
- Thin green line: Entry price at which you can buy the trading instrument.
- Thick green line: Expected price where you can set Take Profit or manually lock in profits, as further growth beyond this level is unlikely.
- Thin red line: Entry price at which you can sell the trading instrument.
- Thick red line: Expected price where you can set Take Profit or manually lock in profits, as further decline below this level is unlikely.
- MACD Indicator: It is important to consider overbought and oversold zones when entering the market.
Important: Beginner traders in the forex market need to be very cautious when making trading decisions. Before the release of important fundamental reports, it's best to stay out of the market to avoid being caught in sharp price swings. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you don't practice money management and trade 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 intraday traders.
