Analysis of Trades and Trading Tips for the Japanese Yen

The test of the 144.84 level coincided with the MACD indicator just beginning to move downward from the zero mark, confirming the correct entry point for selling the dollar and resulting in a drop of more than 30 pips.

The easing of tensions in the Middle East, like balm on the wounds of investors, combined with moderately dovish comments from Federal Reserve Chairman Jerome Powell, is creating a fertile environment for the prosperity of risk assets, thereby weakening the U.S. dollar's position. This favorable backdrop, in turn, is exerting significant pressure on the American currency, prompting traders to take a fresh look at the Japanese yen.

Today's decent data on the service price index among Japanese corporations was ignored, so the pair's further direction will likely depend more on the dollar's strength than on buyers' confidence in the yen. In the short term, if the Fed moves toward a more accommodative policy, the dollar may continue to weaken, leading to further strengthening of the yen. In the medium term, much will depend on the resilience of the U.S. economy and the Bank of Japan's ability to withstand pressure from external factors.

When acting on the bearish side, it is crucial to exercise maximum caution, conduct thorough risk assessments, and be prepared for sudden market changes. Otherwise, impulsive decisions may result in significant financial losses.

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 145.17 (green line on the chart), targeting a rise to 145.66 (thicker green line on the chart). Around 145.66, I intend to exit long positions and open short positions in the opposite direction (expecting a 30–35 pip pullback from the level). It's best to return to buying the pair during corrections and serious pullbacks in USD/JPY.

Important: Before buying, ensure that the MACD indicator is above the zero line and beginning to rise.

Scenario #2: I also plan to buy USD/JPY today in the event of two consecutive tests of the 144.84 level while the MACD indicator is in the oversold zone. This will limit the pair's downside potential and lead to an upward reversal. A rise toward the opposite levels of 145.17 and 145.66 can be expected.

Sell Scenario

Scenario #1: I plan to sell USD/JPY today only after the 144.84 level is breached (red line on the chart), which could trigger a quick drop in the pair. The main target for sellers will be the 144.24 level, where I plan to exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 pip pullback from the level). Selling pressure may quickly return today.

Important: Before selling, ensure that the MACD indicator is below the zero line and beginning to decline.

Scenario #2: I also plan to sell USD/JPY today in the event of two consecutive tests of the 145.17 level while the MACD indicator is in the overbought zone. This will limit the pair's upside potential and lead to a downward reversal. A decline toward the opposite levels of 144.84 and 144.24 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.