Trade Analysis and Tips for Trading the Japanese Yen
There were no tests of the prices I mentioned in the second half of the day. Volatility expectedly decreased due to the lack of data, which also limited the upward potential of the U.S. dollar, which faced a major sell-off during today's Asian session. Despite the report on the change in Japan's monetary base matching economists' forecasts and the sale of 10-year bonds, where demand was lower than expected, pressure on the dollar resumed as big players returned to the market. The ongoing upward correction in USD/JPY may end quickly, so it would be better to look for selling opportunities that align with the downward trend observed in recent months. As for the intraday strategy, I will rely more on scenarios No. 1 and 2.
Buy Signal
Scenario No. 1: Today, I plan to buy USD/JPY when it reaches the entry point at 146.44, plotted by the green line on the chart, with the goal of rising to 147.21, plotted by the thicker green line on the chart. In the area of 147.21, I intend to exit long positions and open short positions in the opposite direction, expecting a movement of 30-35 pips in the opposite direction from the level. We can count on the pair to rise today, but we need buyers to be active in the area of 146.00. Important: Before buying, ensure the MACD indicator is above the zero mark and starting to rise from it.
Scenario No. 2: I also plan to buy USD/JPY today in case of two consecutive tests of 145.99 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reverse market upturn. We can expect growth to the opposite levels of 146.44 and 147.21.
Sell Signal
Scenario No. 1: I plan to sell USD/JPY today only after testing the level of 145.99 plotted by the red line on the chart, which will lead to a rapid decline in the pair. The key target for sellers will be the level of 145.41, where I intend to exit short positions and immediately open long positions in the opposite direction, expecting a movement of 20-25 pips in the opposite direction from that level. Pressure on USD/JPY may return at any moment, since the bearish market for the dollar has not gone away. Important: Before selling, ensure the MACD indicator is below the zero mark and starting to decline.
Scenario No. 2: I also plan to sell USD/JPY today in case of two consecutive tests of 146.44 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reverse market downturn. We can expect a decline to the opposite level of 145.99 and 145.41.
What's on the Chart:
Thin green line: the entry price at which you can buy the trading instrument.
Thick green line: the estimated price at which you can set Take Profit or manually close positions, as further growth above this level is unlikely.
Thin red line: the entry price at which you can sell the trading instrument.
Thick red line: an estimated price at which you can place Take Profit or manually close positions, as further decline below this level is unlikely.
MACD indicator: when entering the market, it is essential to be guided by overbought and oversold zones.
Important: Novice traders in the forex market need to be very careful when making decisions about entering the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You must set stop orders to avoid losing your entire deposit, especially if you don't use money management and trade in large volumes.
Remember, a clear trading plan, like the one I've outlined, is essential for successful trading. Making impulsive decisions based on the current market situation is a losing strategy for novice intraday traders.