Trade Review and Tips for Trading the Japanese Yen
The test of the 152.40 price level occurred when the MACD line had just begun moving downward from the zero line, confirming an optimal entry point for selling the dollar. Although this seemed promising after the morning upward correction, the pair ultimately did not experience a significant drop. Important U.S. economic data is scheduled for release in the second half of the day, providing further insight into the U.S. economy. Strong data on the unemployment rate, non-farm payrolls, and average hourly earnings may provide a reason to buy USD/JPY. Otherwise, the pair may see a substantial decline. For the intraday strategy, I'll focus primarily on Scenario #1, as I expect a strong directional movement following the data.
Buy Signal
Scenario #1: Today, I plan to buy USD/JPY if it reaches the entry point around 152.94 (green line on the chart), targeting a rise to 153.61 (thicker green line on the chart). I intend to close positions around 153.61 and open a sell position in the opposite direction, anticipating a movement of 30-35 points from that level. Today's rally for the pair is likely only after strong U.S. data. Note: Before buying, ensure that the MACD line 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 152.54 price level, with the MACD line in the oversold zone. This will limit the pair's downward potential and likely prompt a reversal upward. I expect growth toward the opposite levels of 152.94 and 153.61.
Sell Signal
Scenario #1: I plan to sell USD/JPY after it breaks below the 152.54 level (red line on the chart), which would likely lead to a rapid decline in the pair. The primary target for sellers is 151.91, where I plan to exit short positions and immediately initiate a buy order in the opposite direction, anticipating a movement of 20-25 points from that level. Pressure on the pair may resume following weak U.S. data. Note: Before selling, ensure that the MACD line 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 152.94 level, with the MACD line in the overbought area. This will limit the pair's upward potential and likely lead to a reversal downward. I expect a decline toward the opposite levels of 152.54 and 151.91.
Chart Key:
- Thin Green Line – Entry price to buy the trading instrument.
- Thick Green Line – Target price for setting Take Profit or manually securing profit, as further growth above this level is unlikely.
- Thin Red Line – Entry price to sell the trading instrument.
- Thick Red Line – Target price for setting Take Profit or manually securing profit, as further decline below this level is unlikely.
- MACD Line: It's essential to use overbought and oversold zones as a guide when entering the market.
Important
Beginner Forex traders should exercise caution when deciding on market entry. Before significant fundamental reports are released, it's best to stay out of the market to avoid sudden price fluctuations. If you choose to trade during news releases, always set stop orders to minimize losses. Without stop orders, you could quickly lose your entire deposit, especially if you're trading large volumes without applying money management.
Remember, successful trading requires a clear trading plan, like the one provided above. Making impulsive trading decisions based on the current market situation is inherently a losing strategy for intraday traders.
