Trade analysis and guidance on trading the Japanese yen

The price test at 159.48 occurred when the MACD indicator was just beginning to move up from zero, confirming a good entry point for buying the dollar. As a result, the pair rose nearly 30 points.

In the second half of the day, market attention will focus on weekly U.S. jobless claims and the U.S. trade balance. Positive results from these reports are expected to increase demand for the U.S. dollar and put further pressure on the yen. However, it's important to remember that the pair is currently near the 160 level, where last week the Bank of Japan repeatedly hinted at possible interventions to curb the yen's decline. Therefore, one should think carefully before buying USD/JPY at current highs. The best approach is to act on corrections, which may occur if U.S. data is weak.

For intraday strategy, I will primarily rely on scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy USD/JPY today around 159.71 (thin green line on the chart) with a target of 160.22 (thicker green line on the chart). Around 160.22, I will exit long positions and open sales in the opposite direction (targeting a 30–35 point reversal). Growth in the pair today is expected only if U.S. data is positive. Important: Before buying, ensure the MACD is above zero and just beginning to rise.

Scenario #2: I also plan to buy USD/JPY if the price tests 159.49 twice consecutively while the MACD is in oversold territory. This will limit the pair's downward potential and trigger an upward reversal. Growth toward 159.71 and 160.22 can be expected.

Sell Signal

Scenario #1: I plan to sell USD/JPY today after the price drops below 159.49 (red line on the chart), which will trigger a rapid decline. The key target for sellers is 159.03, where I will exit sales and immediately open buys in the opposite direction (targeting a 20–25 point reversal). Pressure on the pair may increase further after weak data. Important: Before selling, ensure the MACD is below zero and just beginning to fall.

Scenario #2: I also plan to sell USD/JPY if the price tests 159.71 twice consecutively while the MACD is in overbought territory. This will limit the pair's upward potential and trigger a downward reversal. A decline toward 159.49 and 159.03 can be expected.

Chart Overview

• Thin green line – entry price for buying the instrument;
• Thick green line – suggested level for Take Profit or manual profit-taking, as further growth above this level is unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – suggested level for Take Profit or manual profit-taking, as further decline below this level is unlikely;
• MACD indicator – when entering the market, pay attention to overbought and oversold zones.

Important: Beginner Forex traders should exercise extreme caution when entering the market. It is best to stay out of the market before major fundamental reports to avoid sharp price swings. If you trade during news releases, always place stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember, successful trading requires a clear plan, like the one presented above. Making spontaneous trading decisions based solely on current market conditions is a losing strategy for intraday traders.