FX.co ★ Analysis and trading tips for USD/JPY on January 5

Analysis of transactions and tips for trading USD/JPY

Further growth became limited because the test of 144.15 coincided with the sharp upward move of the MACD line from zero. Meanwhile, sales on the rebound from 144.74 led to a price decrease of around 25 pips.

Weak data on Japan's Service PMI, together with yesterday's Manufacturing PMI, led to a decline in the Composite PMI, intensifying the pressure on yen. If the upcoming labor market report in the US exceeds expectations, USD/JPY will surge in price, especially considering the data published by ADP yesterday.

For long positions:

Buy when the price hits 145.02 (green line on the chart) and take profit at 145.86. Growth will occur after strong data from the US.

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 144.64, but the MACD line should be in the oversold area as only by that will the market reverse to 145.02 and 145.86.

For short positions:

Sell when the price reaches 144.64 (red line on the chart) and take profit at 143.94. However, ressure will unlikely return in the morning.

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 145.02, but the MACD line should be in the overbought area as only by that will the market reverse to 144.64 and 143.94.

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.