Trade Analysis and Tips for Trading the Japanese Yen

The test of the 159.74 price level occurred at a moment when the MACD indicator was just beginning to move downward from the zero line, which confirmed a valid entry point for selling the dollar. As a result, the pair declined by 12 points.

Going forward, developments will depend less on U.S. macroeconomic data and more on the situation in the Middle East. The University of Michigan Consumer Sentiment Index, along with inflation expectations data, will serve as a kind of indicator of the U.S. economic situation, but they are unlikely to significantly change the balance of power in the USD/JPY pair. On the other hand, if traders see signs of sustained economic growth and hints of possible tightening of Federal Reserve monetary policy, demand for the dollar could increase. This may lead to the USD/JPY pair strengthening above the 160 level.

As for the intraday strategy, I will mainly rely on Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy USD/JPY today upon reaching the entry point around 159.79 (green line on the chart), with a target at 160.00 (thicker green line). At 160.00, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move back). Growth in the pair today may occur if tensions between the U.S. and Iran escalate.Important! Before buying, make sure the MACD indicator is above the zero line and just starting to rise from it.

Scenario No. 2: I also plan to buy USD/JPY if there are two consecutive tests of the 159.70 level while the MACD indicator is in the oversold zone. This would limit downward potential and trigger a reversal upward. A move toward 159.79 and 160.00 can then be expected.

Sell Signal

Scenario No. 1: I plan to sell USD/JPY after a break below the 159.70 level (red line on the chart), which should lead to a quick decline. The key target for sellers is 159.43, where I will exit shorts and immediately open longs in the opposite direction (expecting a 20–25 point rebound). Pressure on the pair may return today if positive news emerges from the Middle East.Important! Before selling, make sure the MACD indicator is below the zero line and just beginning to decline.

Scenario No. 2: I also plan to sell USD/JPY if there are two consecutive tests of the 159.79 level while the MACD indicator is in the overbought zone. This would limit upward potential and lead to a downward reversal. A decline toward 159.70 and 159.43 can then be expected.

Chart Notes

• Thin green line – entry price for buying the trading instrument
• Thick green line – estimated Take Profit level or area for manual profit-taking, as further upside above this level is unlikely
• Thin red line – entry price for selling the trading instrument
• Thick red line – estimated Take Profit level or area for manual profit-taking, as further downside below this level is unlikely
• MACD indicator – when entering trades, pay attention to overbought and oversold zones

Important: Beginner Forex traders should be very cautious when making trading decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp volatility. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-losses, you may quickly lose your entire deposit—especially if you do not use proper money management and trade large volumes.

And remember, successful trading requires a clear trading plan like the one outlined above. Making spontaneous trading decisions based on current market conditions is a losing strategy for intraday traders from the outset.