Review of Trades and Advice on Trading the Japanese Yen
The test of the 149.63 price level occurred when the MACD indicator had just started moving upward from the zero line, confirming a valid entry point. This signaled a buying opportunity to continue the upward trend. As a result, the pair moved up by about 20 points, but that was the end of the action. The pair continues to experience decreasing volatility, increasingly confined within a narrow sideways channel. Perhaps something will change in the second half of the day after the release of U.S. retail sales and industrial production data. However, only significantly better-than-expected economic data will be able to continue the upward trend in USD/JPY. For intraday strategy, I plan to act based on the execution of Scenarios #1 and #2.
Buy Signal
Scenario #1: I plan to buy USD/JPY today upon reaching the entry point around 149.67 (green line on the chart), with a target of rising to the 150.06 level (thicker green line on the chart). At 150.06, I will exit the long position and open a short position in the opposite direction (expecting a movement of 30-35 points downward from that level). The pair's growth today can only be expected within the channel. Important! Before buying, ensure the MACD indicator is above the zero line and just starting to rise from it.
Scenario #2: I also plan to buy USD/JPY today in the case of two consecutive tests of the 149.44 price, at a time when the MACD indicator is in the oversold area. This will limit the pair's downward momentum and lead to a market reversal upward. Growth can be expected towards the opposite levels of 149.67 and 150.06.
Sell Signal
Scenario #1: I plan to sell USD/JPY today after breaking below the 149.44 level (red line on the chart), which should lead to a quick decline. The key level for sellers will be 149.17, where I will exit the short position and immediately buy in the opposite direction (expecting a movement of 20-25 points upward from that level). Selling pressure will return to the pair if there is a breach of the daily high. Important! Before selling, ensure the MACD indicator is below the zero line and just starting to fall from it.
Scenario #2: I also plan to sell USD/JPY today in the case of two consecutive tests of the 149.67 level, 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 can be expected towards the opposite levels of 149.44 and 149.17.
Chart Explanation:
- Thin green line – The entry price where you can buy the trading instrument.
- Thick green line – The projected price where you can set Take Profit or manually lock in profits, as further growth above this level is unlikely.
- Thin red line – The entry price where you can sell the trading instrument.
- Thick red line – The projected 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's important to focus on overbought and oversold areas.
Important:Beginner traders in the forex market should exercise extra caution when making decisions about entering the market, especially before key fundamental reports. It's best to stay out of the market before key fundamental reports are released to avoid sudden price fluctuations. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you could quickly lose your entire deposit, especially if you do not practice money management and trade large volumes.
Remember, for successful trading, you need a clear trading plan, like the one outlined above. Making spontaneous trading decisions based on the current market situation is initially a losing strategy for an intraday trader.
