Trade Review and Tips for the Japanese Yen

The first test of the 147.62 price level occurred when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. For this reason, I did not sell the dollar. The second test of this price level happened when the MACD was in the oversold zone, which allowed Scenario #2 for buying the dollar to materialize and resulting in a 20-point increase.

Traders' attention now turns to the speech by FOMC member Michelle Bowman. Many will closely monitor her remarks on the future path of interest rates and inflation prospects—especially ahead of Powell's speech in Jackson Hole. The market is watching carefully for any signals that could point to a possible shift in the Federal Reserve's monetary policy. Particular attention will be paid to how Bowman assesses the latest macroeconomic data, including employment, inflation, and GDP growth. Any hints of a more dovish stance could trigger a sharp reaction in the currency market. It will also be important to evaluate how Bowman views the balance of risks between fighting inflation and supporting economic growth. Given current economic uncertainty, her comments may provide valuable insight into how the Fed sees the optimal way forward.

Also today, U.S. building permits and housing starts data will be released. These indicators help assess the outlook for the housing market and, by extension, the overall state of the economy. A rise in approved permits indicates improved sentiment among construction companies and potential buyers, foreshadowing higher construction activity in the near future. Housing starts reflect current confidence in housing demand. Growth in this measure suggests that developers are ready to invest in new projects, anticipating profitability.

As for the intraday strategy, I will rely mainly on the implementation of scenarios #1 and #2.

Buy Signal

Scenario #1: Today, I plan to buy USD/JPY upon reaching the entry point around 147.86 (green line on the chart) with a target of 148.20 (thicker green line on the chart). Around 148.20, I will exit long positions and open short positions in the opposite direction (expecting a 30–35-point pullback from the level). A moderate rise in the pair is possible if strong data is released. Important! Before buying, make sure the MACD indicator is above the zero line and just starting to rise from it.

Scenario #2: I also plan to buy USD/JPY if there are two consecutive tests of the 147.62 level while the MACD is in the oversold zone. This will limit the pair's downward potential and lead to a reversal upward. A rise toward the opposite levels of 147.86 and 148.20 can be expected.

Sell Signal

Scenario #1: Today, I plan to sell USD/JPY after updating the 147.62 level (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be 147.27, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25-point rebound from the level). Downward pressure on the pair will return if weak data is released. Important! Before selling, make sure the MACD indicator is below the zero line and just starting to decline from it.

Scenario #2: I also plan to sell USD/JPY if there are two consecutive tests of the 147.86 level while the MACD is in the overbought zone. This will limit the pair's upward potential and lead to a reversal downward. A decline toward the opposite levels of 147.62 and 147.27 can be expected.

Chart Notes:

• Thin green line – entry price for buying the instrument;
• Thick green line – assumed price where Take Profit can be placed or profits fixed manually, as further growth above this level is unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – assumed price where Take Profit can be placed or profits fixed manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to use overbought and oversold zones.

Important: Beginner Forex traders must be very cautious when making entry decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always use stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you trade large volumes without money management.

And remember, successful trading requires a clear trading plan, such as the one I outlined above. Making spontaneous trading decisions based only on the current market situation is initially a losing strategy for an intraday trader.