Analysis of Trades and Trading Tips for the Japanese Yen

The price test at 140.68 occurred when the MACD indicator had already moved significantly above the zero line, which, in my view, limited the pair's upside potential. For this reason, I did not buy the dollar and missed a fairly strong upward movement in the pair.

Yesterday's statement from Donald Trump, indicating a willingness to make concessions in trade disputes with China, triggered dollar buying and weakened the yen's position. Additionally, Trump's withdrawal from replacing Federal Reserve Chairman Jerome Powell supported the USD/JPY pair. Today's mixed data on Japan's PMI for manufacturing and services led to a minor correction in the pair, though these figures are unlikely to influence its further direction. Most likely, the yen's exchange rate against the dollar will continue to depend on factors such as the Fed's rate decisions and Trump's actions. Given the fragility of the U.S. economy and the risk of rising inflation, the Fed may maintain a hawkish stance, which would strengthen the dollar and pressure the yen.

For intraday strategy, I will focus primarily on implementing Scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy USD/JPY today at the entry point of 142.02 (green line on the chart) with a target of 142.78 (thicker green line). At the 142.78 level, I plan to exit the buy trade and open a sell position in the opposite direction (targeting a 30–35 pip reversal).

Important! Before buying, ensure the MACD indicator is above zero and beginning to rise.

Scenario #2: I also plan to buy USD/JPY today after two consecutive tests of the 141.51 level when the MACD is in oversold territory. This will limit the pair's downside potential and lead to an upward reversal. A rise to the opposite levels of 142.02 and 142.78 can be expected.

Sell Signal

Scenario #1: I plan to sell USD/JPY only after a breakout below the 141.51 level (red line on the chart), which will trigger a quick drop. The main target for sellers will be 140.89, at which point I will exit the short and immediately buy in the opposite direction (aiming for a 20–25 pip rebound).

Important! Before selling, ensure the MACD is below zero and starting to decline.

Scenario #2: I also plan to sell USD/JPY today after two consecutive tests of the 142.02 level when the MACD is in overbought territory. This will limit the pair's upward potential and lead to a reversal downward. A drop to the opposite levels of 141.51 and 140.89 can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.