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21.11.202409:10 Forex Analysis & Reviews: USD/JPY: Simple Trading Tips for Beginner Traders on November 21. Analysis of Yesterday's Forex Trades

Analysis of Trades and Trading Recommendations for the Japanese Yen

The test of the 155.65 price level occurred when the MACD indicator had just started moving down from the zero line, confirming a valid entry point for selling the dollar. As a result, the pair dropped to the target level of 155.16.

The U.S. dollar remains in demand despite expectations of an interest rate hike in Japan. Today's speech by Bank of Japan Governor Kazuo Ueda had a noticeable impact on financial markets, leading to a slight yen strengthening. Speaking at a press conference, Ueda emphasized the need to evaluate the current economic situation further and adapt monetary policy to global changes. His comments on a potential policy shift amid inflationary pressures sparked some interest, although he provided no definitive recommendations.

According to economists, short-term expectations for interest rate hikes in Japan became more justified after the governor's speech, prompting a drop in the USD/JPY pair. However, this has not affected the broader upward trend. Considering the challenges facing Japan's economy during recovery, Ueda noted that a readiness to adjust rates could bolster confidence in the yen. Still, given the global dominance of the U.S. dollar against various risk assets, caution is advised when selling the pair. For intraday strategies, I will focus on Scenario #1 and Scenario #2.

Exchange Rates 21.11.2024 analysis

Buy Scenarios

Scenario #1:

I plan to buy USD/JPY today at the 155.04 entry level (green line on the chart) with a target of 155.66 (thicker green line on the chart). At 155.66, I plan to exit purchases and open sales in the opposite direction, aiming for a 30-35 pip reversal from the entry point. Growth in the pair is possible, but it is better to buy on corrections. Important! Before buying, ensure that the MACD indicator is above the zero line and beginning to rise.

Scenario #2:

I also plan to buy USD/JPY if the MACD indicator is in the oversold zone and the pair tests 154.55 twice consecutively. This will limit the pair's downward potential and lead to an upward market reversal. A rise to the opposite levels of 155.04 and 155.66 can be expected.

Sell Scenarios

Scenario #1:

I plan to sell USD/JPY only after breaking below the 154.55 level (red line on the chart), which should lead to a quick decline in the pair. The key target for sellers will be 153.97, where I plan to exit sales and immediately open purchases in the opposite direction, aiming for a 20-25 pip reversal. Downward pressure on the pair may persist during the first half of the day. Important! Before selling, ensure that the MACD indicator is below the zero line and beginning to decline.

Scenario #2:

I also plan to sell USD/JPY if the MACD indicator is in the overbought zone and the pair tests 155.04 consecutively. This will limit the pair's upward potential and lead to a market reversal downward. A decline to the opposite levels of 154.55 and 153.97 can be expected.

Exchange Rates 21.11.2024 analysis

What's on the Chart:

  • 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 Notes for Beginner Forex 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.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Jakub Novak,
Analytical expert of InstaSpot
© 2007-2024
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