Trade analysis and advice on trading the Japanese yen
The designated test levels were not reached in the first half of the day.
In the second half of the day, USD/JPY will be strongly influenced by data on initial jobless claims, Q2 GDP, and the U.S. Personal Consumption Expenditures (PCE) index. These macroeconomic indicators, like seismic waves, can trigger significant volatility in the currency market, determining the pair's next direction.
Initial jobless claims serve as a barometer of labor market health. A sharp decline would signal resilience and likely be interpreted positively by the Federal Reserve. Conversely, an increase could point to deteriorating conditions, weakening the dollar. Stronger U.S. GDP would confirm economic stability and strengthen the dollar, while weaker data could cast doubt on future growth and weigh on the currency.
As for intraday strategy, I will rely mainly on implementing scenarios #1 and #2.
Buy signal
Scenario #1: I plan to buy USD/JPY today at the entry point around 148.95 (green line on the chart), targeting growth toward 149.60 (thicker green line on the chart). Around 149.60, I will exit long positions and open shorts in the opposite direction (expecting a 30–35 point pullback). A continuation of the bullish market would support further upside. Important! Before buying, make sure the MACD indicator is above the zero line and only beginning to rise from it.
Scenario #2: I also plan to buy USD/JPY today if there are two consecutive tests of 148.71, at a moment when the MACD indicator is in the oversold zone. This will limit the pair's downward potential and trigger a reversal upward. Growth toward the opposite levels of 148.95 and 149.60 can then be expected.
Sell signal
Scenario #1: I plan to sell USD/JPY today after a breakout below 148.71 (red line on the chart), which would lead to a quick decline in the pair. The key bearish target will be 148.05, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point rebound). Selling pressure may return if the Fed takes a dovish stance. Important! Before selling, make sure the MACD indicator is below the zero line and only beginning to decline from it.
Scenario #2: I also plan to sell USD/JPY today in case of two consecutive tests of 148.95, at a moment when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and trigger a reversal downward. A decline toward the opposite levels of 148.71 and 148.05 can then be expected.
Chart guide
- Thin green line – entry price where the instrument can be bought.
- Thick green line – approximate price to set Take Profit or lock in profit manually, as further growth above this level is unlikely.
- Thin red line – entry price where the instrument can be sold.
- Thick red line – approximate price to set Take Profit or lock in profit manually, as further decline below this level is unlikely.
- MACD indicator – when entering the market, it is important to follow overbought and oversold zones.
Important. Beginner Forex traders must be very cautious when making entry decisions. Ahead of important fundamental reports, it is best to stay out of the market to avoid sharp volatility. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you ignore money management and trade with large volumes.
And remember: successful trading requires a clear trading plan, like the one outlined above. Spontaneous trading decisions based on current market moves are inherently a losing strategy for intraday traders.
