Analysis of Trades and Trading Tips for the Japanese Yen
The price test at 150.91 occurred when the MACD indicator had just begun moving upward from the zero mark, confirming a valid entry point for buying the dollar. As a result, the pair moved up about 20 pips, which was the end.
During today's Asian session, the yen faced another brief selling session. News of an increase in the Tokyo Consumer Price Index, which reflects the level of inflation in Japan's capital, caught the attention of investors looking for signs of a shift in the Bank of Japan's monetary policy.
Another factor contributing to the yen's strength was the release of the summary of opinions from the BOJ's policy board members. This document, which contains excerpts from discussions on the current economic situation and monetary policy outlook, was closely scrutinized by market participants for hints of a potential shift in the central bank's approach.
For intraday strategy, I will focus primarily on implementing Scenarios #1 and #2.
Buy Signal
Scenario #1: I plan to buy USD/JPY today if the price reaches the entry point around 151.00 (green line on the chart), targeting a rise to 151.55 (thicker green line on the chart). Around 151.55, I plan to exit long positions and open short ones in the opposite direction (anticipating a pullback of 30–35 pips from the level). It's best to return to buying the pair during corrections and substantial USD/JPY pullbacks. 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 the case of two consecutive tests of the 150.75 level when the MACD indicator is in the oversold zone. This would limit the pair's downside potential and trigger an upward reversal. A rise toward the opposite levels of 151.00 and 151.55 can be expected.
Sell Signal
Scenario #1: I plan to sell USD/JPY today only after the 150.75 level (red line on the chart) is breached, which would lead to a quick drop in the pair. The key target for sellers will be the 150.22 level, where I plan to exit short positions and immediately open long ones in the opposite direction (expecting a 20–25 pip rebound from the level). Downward pressure on the pair could return at any moment. Important: Before selling, ensure the MACD indicator is below the zero line and starting to decline from it.
Scenario #2: I also plan to sell USD/JPY today in the case of two consecutive tests of the 151.00 level when the MACD indicator is in the overbought zone. This would limit the pair's upside potential and trigger a downward reversal. A decline toward the opposite levels of 150.75 and 150.22 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.
