Analysis of Trades and Trading Tips for the Japanese Yen

The test of the 148.36 price level occurred when the MACD indicator had just begun moving downward from the zero mark, confirming the correct entry point for selling the dollar. As a result, the pair declined by more than 40 pips.

The published U.S. consumer price index data, indicating a restrained increase, generated cautious optimism in the market. Such moderate dynamics were interpreted as a hint at a possible softening of the Federal Reserve's stance on interest rates. Nevertheless, it is too early to draw conclusions, as the situation is far from straightforward. Core inflation, excluding volatile food and energy prices, still exceeds the target set by the Fed. This suggests that the central bank will likely continue to monitor economic data closely and, if necessary, be ready to take further measures to contain inflation. The impact on the currency market may also turn out to be less evident than it initially seems. The dollar's weakening, caused by reduced expectations for aggressive Fed policy, could be offset by other factors such as geopolitical tensions, shifts in investor sentiment, or revised economic outlooks. Thus, the future direction of currency movements remains uncertain and will depend on a complex interplay of multiple factors – including the stance of the Bank of Japan.

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

Buy Scenario

Scenario No. 1: Today, I plan to buy USD/JPY upon reaching the entry point around 148.03 (green line on the chart), targeting a rise to 148.46 (thicker green line on the chart). Around 148.46, I plan to exit buy positions and open sell trades in the opposite direction, aiming for a 30–35 pip downward move from the level. It is best to return to buying the pair during pullbacks and significant declines in USD/JPY. Important! Before buying, make sure the MACD indicator is above the zero mark and has just begun to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today in the event of two consecutive tests of the 147.81 price level while the MACD indicator is in the oversold zone. This will limit the pair's downside potential and lead to an upward market reversal. A rise toward the opposite levels of 148.03 and 148.46 can be expected.

Sell Scenario

Scenario No. 1: I plan to sell USD/JPY today only after the 147.81 level (red line on the chart) is updated, which will likely lead to a rapid decline in the pair. The key target for sellers will be 147.46, where I plan to exit sell positions and immediately open buy trades in the opposite direction, aiming for a 20–25 pip upward move from the level. Selling is best executed from higher levels. Important! Before selling, make sure the MACD indicator is below the zero mark and has just begun to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today if there are two consecutive tests of the 148.03 price level while the MACD indicator is in the overbought zone. This will limit the pair's upside potential and lead to a market reversal downward. A decline toward the opposite levels of 147.81 and 147.46 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.