FX.co ★ Analysis and trading tips for USD/JPY on December 28

Analysis of transactions and tips for trading USD/JPY

The test of 142.46, coinciding with the decline of the MACD line from zero, provoked a sell signal that resulted in a price decrease of over 30 pips.

Strong retail sales data in Japan reminded traders that the Bank of Japan may abandon its soft monetary policy next year, strengthening demand for yen and leading to another return of the pair to the monthly low. Most likely, buyers will fight to prevent the pair from falling below 141.00, so selling at the current year-end low, despite the development of a downward trend, should be approached with extreme caution.

For long positions:

Buy when the price hits 141.35 (green line on the chart) and take profit at 141.92. Growth will occur after defending the monthly low and in the absence of bearish activity during attempts to break below it.

When buying, ensure that the MACD line lies above zero or rises from it. Also consider buying USD/JPY after two consecutive price tests of 140.95, but the MACD line should be in the oversold area as only by that will the market reverse to 141.35 and 141.92.

For short positions:

Sell when the price reaches 140.95 (red line on the chart) and take profit at 140.43. Pressure will return in the case of unsuccessful bullish actions around the daily high.

When selling, ensure that the MACD line lies below zero or drops down from it. Also consider selling USD/JPY after two consecutive price tests of 141.35 but the MACD line should be in the overbought area as only by that will the market reverse to 140.95 and 140.43.

What's on the chart:

Thin green line - entry price at which you can buy USD/JPY

Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.

Thin red line - entry price at which you can sell USD/JPY

Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.

MACD line- it is important to be guided by overbought and oversold areas when entering the market

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.