Trade Analysis and Tips for the Japanese Yen

The price test at 148.12 during the first half of the day came at a time when the MACD indicator had significantly moved below the zero mark, which limited the pair's downward potential. For this reason, I did not sell the dollar.

The yen could strengthen further against the dollar, as speeches by FOMC members John Williams and Thomas Barkin are expected in the second half of the day. A dovish tone from policymakers could lead to a drop in the USD/JPY pair. In recent days, the Japanese currency has shown signs of weakening, and today's statements from politicians might serve as a reason to pause. If Williams and Barkin take a more cautious stance in their speeches—highlighting risks to economic growth and inflation—it could lead to a re-evaluation of expectations regarding future interest rate cuts by the Fed. However, considering that the Fed's dovish policy has largely contributed to the dollar's weakening in recent times, any hints of further easing could lead to another wave of dollar selling. A dovish tone from FOMC members will not only reduce the appeal of the dollar but also create additional incentive for yen appreciation, as it would reduce pressure on the Bank of Japan and allow it to maintain its current policy for a longer period.

As for intraday strategy, I will rely more on implementing Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: I plan to buy USD/JPY today upon reaching the entry point around 147.96 (green line on the chart), with the target of rising to 148.33 (thicker green line on the chart). Around 148.33, I will exit long positions and open shorts in the opposite direction (anticipating a movement of 30–35 points in the opposite direction from this level). A bullish continuation of the market could support this rise. Important! Before buying, make sure that the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario #2: I also plan to buy USD/JPY today if there are two consecutive tests of the 147.79 price level, at a time when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upward. Growth toward opposite levels at 147.96 and 148.33 can be expected.

Sell Signal

Scenario #1: I plan to sell USD/JPY today after the price breaks below the 147.79 level (red line on the chart), which should result in a quick drop of the pair. The key target for sellers will be the 147.45 level, where I will exit short positions and immediately open long positions in the opposite direction (anticipating a movement of 20–25 points in the opposite direction from this level). Pressure on the pair will remain today if policymakers adopt a dovish stance. Important! Before selling, make sure that the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario #2: I also plan to sell USD/JPY today in case of two consecutive tests of the 147.96 level, at a time when the MACD indicator is in the overbought area. This will limit the upward potential of the pair and lead to a market reversal downward. A decline toward opposing levels of 147.79 and 147.45 can be expected.

Chart Explanation:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated price where Take Profit can be placed or profits can be manually fixed, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated price where Take Profit can be placed or profits can be manually fixed, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it's important to follow overbought and oversold zones.

Important: Beginner Forex traders need to be very cautious when making market entry decisions. It is best to stay out of the market before major fundamental reports are released in order to avoid sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you don't use proper money management and trade large volumes.

And remember, successful trading requires a clear trading plan, like the one presented above. Making impulsive trading decisions based on current market conditions is an inherently losing strategy for intraday traders.