Analysis of Trades and Trading Tips for the Japanese Yen
The price test at 159.44 occurred at a moment when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. For this reason, I did not sell the dollar.
Ahead are the US GDP figures for the beginning of the year and the Core Personal Consumption Expenditures (PCE) Price Index. At the same time, speeches by FOMC members John Williams and Alberto Musalem are scheduled.
The speeches by Williams and Musalem will be closely monitored by analysts looking for even the smallest details. A shift toward a hawkish stance and tighter rhetoric would indicate that policymakers are seriously concerned about maintaining price stability. In such an environment, any hints at the need for further tightening of credit conditions could trigger a strong wave of dollar appreciation and yen depreciation. Together with the Core PCE data, which is the Federal Reserve's key inflation benchmark, the direction of future policy will become clearer. Strong data, rising inflation, and a hawkish Fed stance all support new USD/JPY buy positions.
As for the intraday strategy, I will rely primarily on the implementation of Scenarios No. 1 and No. 2.
Buy Signal
Scenario No. 1: Today, I plan to buy USD/JPY upon reaching the entry point around 159.54 (green line on the chart), targeting growth toward 159.84 (thicker green line on the chart). Around 159.84, I plan to exit buy positions and open sell positions in the opposite direction, expecting a move of 30–35 points in the reverse direction from that level. A rise in the pair today is possible in the case of weak agreement-related news and strong US data. Important! Before buying, make sure that the MACD indicator is above the zero line and is just beginning to rise from it.
Scenario No. 2: I also plan to buy USD/JPY today in the event of two consecutive tests of the 159.38 level while the MACD indicator is in oversold territory. This would limit the pair's downward potential and lead to a reversal upward. Growth toward the opposite levels of 159.54 and 159.84 can then be expected.
Sell Signal
Scenario No. 1: I plan to sell USD/JPY after a breakout below the 159.38 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be the 159.09 level, where I plan to exit sell positions and immediately open buy positions in the opposite direction, expecting a 20–25 point move in the reverse direction from that level. Pressure on the pair will return today in the case of weak economic reports. Important! Before selling, make sure that the MACD indicator is below the zero line and is just beginning to decline from it.
Scenario No. 2: I also plan to sell USD/JPY today in the event of two consecutive tests of the 159.54 level while the MACD indicator is in overbought territory. This would limit the pair's upward potential and lead to a downward reversal. A decline toward the opposite levels of 159.38 and 159.09 can then be expected.
What Is Shown on the Chart:
- Thin green line – the entry price at which the trading instrument can be bought;
- Thick green line – the estimated level where Take Profit orders can be placed or profits can be locked in manually, as further growth above this level is unlikely;
- Thin red line – the entry price at which the trading instrument can be sold;
- Thick red line – the estimated level where Take Profit orders can be placed or profits can be locked in 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 should make market entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.
And remember that successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based solely on the current market situation are inherently a losing strategy for intraday traders.
