Trade Analysis and Recommendations for the Japanese Yen

The price test at 151.89 occurred when the MACD indicator had already moved significantly above the zero mark, limiting the pair's upward potential—especially in the bearish market environment observed recently. As a result, I did not buy the U.S. dollar.

Later in the session, U.S. housing data on building permits and housing starts could pressure the yen, provided the figures exceed economists' forecasts. Additionally, a hawkish FOMC meeting minutes report would support the dollar's strength, reinforcing expectations that interest rates will remain high for an extended period.

At the same time, domestic factors influencing the yen should not be ignored. Any hints from Bank of Japan officials about continued rate hikes could significantly strengthen the Japanese currency. Investors will closely monitor statements regarding inflation and economic growth prospects in Japan.

For intraday trading, I will focus on executing Scenario #1 and Scenario #2 for both long and short positions.

Buy Signal

Scenario #1: Buy USD/JPY at 152.11, targeting an increase to 152.62. At 152.62, I plan to exit long positions and open a short position for a 30-35 point downward correction. A bullish move in the pair is likely only after strong U.S. economic data. Before entering, ensure that the MACD indicator is above the zero mark and just starting to rise.

Scenario #2: A buy setup is also valid if 151.73 is tested twice, while MACD is in the oversold zone. This would indicate limited downward potential and a likely reversal toward 152.11 and 152.62.

Sell Signal

Scenario #1: Sell USD/JPY after a break below 151.73, leading to a quick decline toward 151.25. At 151.25, I will exit short positions and enter a long trade in the opposite direction for a 20-25 point retracement. Selling pressure is expected only if the FOMC minutes indicate a dovish stance. Before selling, confirm that MACD is below the zero mark and beginning to decline.

Scenario #2: Another short opportunity arises if 152.11 is tested twice, while MACD is in the overbought zone. This would suggest a reversal downward, with a target of 151.73 and 151.25.

Market Notes:

• Thin green line – entry price for buy trades
• Thick green line – expected take-profit area for buy trades, as further growth beyond this level is unlikely
• Thin red line – entry price for sell trades
• Thick red line – expected take-profit area for sell trades, as further decline beyond this level is unlikely
• MACD Indicator – key tool for identifying overbought and oversold market conditions

Important Trading Advice:

Beginner forex traders should be extremely cautious when entering the market. Before major economic releases, it is best to stay on the sidelines to avoid sharp price fluctuations. If trading during news events, always set stop-loss orders to minimize potential losses. Trading without stop-loss protection can lead to rapid account depletion, especially when managing large positions without proper risk management.

For consistent trading success, it is essential to follow a structured plan like the one outlined above. Making impulsive trades based on short-term market movements is a losing strategy for intraday traders.