Analysis of Trades and Trading Tips for the Japanese Yen

The first test of 152.17 occurred when the MACD indicator had moved significantly upward from the zero mark, limiting the pair's upward potential—especially in the current bearish market. For this reason, I did not buy the dollar. A second test of 152.17 shortly afterward coincided with MACD being in the overbought zone and beginning to decline, allowing Scenario #2 for selling to materialize. As a result, the pair dropped by over 30 points.

The only economic reports scheduled for the US session are the Empire Manufacturing Index and the NAHB Housing Market Index, meaning the US dollar is unlikely to receive strong support. FOMC member Michael S. Barr's speech might bring some new insights, but expectations should remain modest. It is likely that Barr will align with his colleagues' cautious stance regarding future rate cuts. He may emphasize the need to assess incoming economic data before making any policy adjustments, with inflation, the labor market, and overall economic activity as key focus areas. While the market will closely monitor any hints of a shift in Fed policy, major surprises are unlikely.

For intraday trading, I will focus on Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: Buy USD/JPY at 152.00, targeting 152.62. At 152.62, I plan to exit long positions and sell the dollar, expecting a 30-35 point pullback. A sustained rally depends on strong US economic data. Important: Before buying, ensure the MACD indicator is above zero and just starting to rise.

Scenario #2: Buy USD/JPY if 151.64 is tested twice, while MACD is in the oversold zone. This will limit downward potential and trigger a market reversal upward. The expected targets are 152.00 and 152.62.

Sell Signal

Scenario #1: Sell USD/JPY at 151.64, targeting 151.13. At 151.13, I will exit short positions and buy for a 20-25 point pullback. Selling pressure may increase if Federal Reserve officials take a dovish stance. Important: Before selling, ensure the MACD indicator is below zero and just starting to decline.

Scenario #2: Sell USD/JPY if 152.00 is tested twice, while MACD is in the overbought zone. This will limit upward potential and cause a market reversal downward. The expected targets are 151.64 and 151.13.

Key Chart Levels

• Thin green line: Entry price for buying.
• Thick green line: Estimated Take Profit level or area where profit-taking is recommended, as further upside is unlikely.
• Thin red line: Entry price for selling.
• Thick red line: Estimated Take Profit level or area where profit-taking is recommended, as further downside is unlikely.
• MACD Indicator: Used to assess overbought and oversold conditions before entering trades.

Important Notes for Beginner Traders

New traders in the Forex market should exercise caution when making trade entries. Before major economic reports, it is best to stay out of the market to avoid unexpected volatility. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss protection, a trader can quickly deplete their account, especially when trading large volumes without risk management.

For successful trading, a clear trading plan is essential, similar to the one outlined above. Making impulsive trading decisions based on short-term market movements is a losing strategy for intraday traders.