Analysis of Trades and Trading Tips for the Japanese Yen

The test of the 145.67 mark occurred when the MACD indicator had already moved significantly above the zero mark, which limited the pair's downside potential. For this reason, I chose not to buy the dollar.

Today's positive data on Japan's Manufacturing and Services PMI cheered traders but did not strengthen the yen. The reason remains the geopolitical developments tied to the U.S. strikes on Iran's nuclear facilities.

Economic indicators, which usually serve as catalysts for movements in the currency market, have taken a back seat, overshadowed by the escalating tensions in the Middle East. Investors concerned about potential instability and rising oil prices prefer to stay in safe-haven assets, ignoring the positive signals from Japan's economy. A paradoxical situation has emerged: Japan's economic fundamentals show signs of recovery yet prove powerless in the face of geopolitical risk. The yen, typically viewed as a safe-haven currency, is not in demand this time, as Japan's proximity to the conflict region raises concerns among investors. In the near term, the dynamics of the yen will be determined solely by developments surrounding Iran. Any signs of de-escalation could trigger a yen rebound, while further escalation will continue to pressure the Japanese currency regardless of domestic economic conditions. Traders have no choice but to watch the geopolitical horizon and adjust their strategies based on news from the Middle East.

For intraday strategy, I will focus primarily on implementing Scenarios #1 and #2.

Buy Scenario

Scenario #1: I plan to buy USD/JPY today upon reaching the entry point around 147.48 (green line on the chart), with a target of rising to 147.98 (thicker green line). Around 147.98, I intend to exit long positions and open short positions in the opposite direction (expecting a 30–35 pip reversal from that level). It is best to return to buying the pair during corrections and deep pullbacks.

Important! Before buying, ensure the MACD indicator is above the zero mark and beginning to rise.

Scenario #2: I also plan to buy USD/JPY today in the event of two consecutive tests of the 147.03 level when the MACD indicator is in the oversold zone. This would limit the pair's downside potential and lead to an upward reversal. A rise toward 147.48 and 147.98 can be expected.

Sell Scenario

Scenario #1: I plan to sell USD/JPY today only after a breakout below the 147.03 level (red line on the chart), which would lead to a sharp drop in the pair. The key target for sellers will be 146.53, where I intend to exit short positions and open long positions in the opposite direction (expecting a 20–25 pip rebound from that level). Selling pressure on the pair may return quickly today.

Important! Before selling, ensure the MACD indicator is below the zero mark and beginning to decline.

Scenario #2: I also plan to sell USD/JPY today in the event of two consecutive tests of the 147.48 level when the MACD indicator is in the overbought zone. This would limit the pair's upside potential and lead to a downward reversal. A decline toward the 147.03 and 146.53 levels can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.