07.01.202510:31 Forex Analyse & Reviews: USD/JPY: Simple Trading Tips for Beginner Traders on January 7. Analysis of Yesterday's Forex Trades

Analysis of Trades and Trading Tips for the Japanese Yen

The first test of the 156.79 price level occurred when the MACD indicator had already dipped significantly below the zero mark, which limited the pair's downward potential. However, the dollar continued to decline, leading to a test of the 156.32 price level. I planned to buy immediately upon a rebound at this level, as mentioned in yesterday's forecast for the second half of the day. This trade resulted in a profit of over 50 pips.

Today's figures on the change in the monetary base are unlikely to impact the dollar's direction against the Japanese yen significantly. Despite the dollar weakening against most global currencies, the USD/JPY pair dynamics are quite different. This may be because the yen is under pressure from the Bank of Japan's dovish monetary policy, which maintains extremely low interest rates. Additionally, expectations of further accommodative policy in Japan limit the yen's potential for strengthening, even as the dollar's appeal wanes. Meanwhile, geopolitical risks sustain demand for the dollar as a safe-haven asset, which may explain its relative resilience against the yen. It is important to note that currency pair dynamics often depend not only on macroeconomic data but also on overall investor sentiment, which currently appears tilted in favor of the dollar.

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

Buy Signal

Scenario #1: I plan to buy USD/JPY today at an entry point around 157.85 (green line on the chart) with a target of rising to 158.54 (thicker green line on the chart). Near 158.54, I intend to exit long positions and open short positions (expecting a pullback of 30–35 pips from this level). It's best to focus on further pair growth and buy on corrections. Important! Before buying, ensure the MACD indicator is above the zero line and starting to rise.

Scenario #2: I also plan to buy USD/JPY today in case of two consecutive tests of the 157.29 price level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth can be expected to the opposite levels of 157.85 and 158.54.

Sell Signal

Scenario #1: I plan to sell USD/JPY today only after the 157.29 level is updated (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be 156.62, where I plan to exit short positions and immediately open long positions (expecting a pullback of 20–25 pips from this level). Significant pressure on the pair is unlikely to return today. Important! Before selling, ensure the MACD indicator is below the zero line and starting to decline.

Scenario #2: I also plan to sell USD/JPY today in case of two consecutive tests of the 157.85 price 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 to the opposite levels of 157.29 and 156.62.

Chart Notes

• Thin green line: Entry price for buying the trading instrument.
• Thick green line: A suggested target for Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line: Entry price for selling the trading instrument.
• Thick red line: A suggested target for Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD Indicator: Critical for identifying overbought and oversold zones to guide market entry decisions.

Important Note for Beginner Traders

• Always approach market entry decisions cautiously.
• Avoid trading during major news releases to sidestep volatile price swings.
• If trading during news releases, always set stop-loss orders to minimize losses.
• Trading without stop-loss orders or money management practices can quickly deplete your deposit, especially when using large volumes.
• A clear trading plan, like the one outlined above, is essential for successful trading. Spontaneous trading decisions based on current market conditions are inherently disadvantageous for intraday traders.