Analysis of Trades and Trading Tips for the Japanese Yen

The test of the price at 159.13 occurred when the MACD indicator was just starting to move down from the zero mark, confirming a valid entry point for selling the dollar. As a result, losses were incurred on the trade since the pair did not decline. Long positions at 159.28 allowed for about 15 pips of profit to be taken from the market.

Today, the yen strengthened against the dollar after the Bank of Japan raised its inflation forecast, with three members of the governing board supporting a rate hike. This change in market sentiment underscores increasing confidence in the Japanese economy and the central bank's desire to control price stability.

The increase in the inflation forecast indicates that the Bank of Japan sees signs of acceleration, which may be linked to global inflation trends and developments in the Middle East. The three members of the governing board who supported the rate hike likely believe that the current monetary policy needs adjustment to prevent economic overheating or to achieve targeted inflation goals.

However, the yen's strengthening was not long-lasting. It is clear that traders will continue to closely monitor further statements from Bank of Japan representatives and developments in the global geopolitical situation.

Regarding the intraday strategy, I will rely more on implementing scenarios No. 1 and No. 2.

Buy Scenarios

Scenario No. 1: I plan to buy USD/JPY today when the entry point reaches around 159.28 (green line on the chart), with a target at 159.62 (thicker green line on the chart). Around 159.62, I plan to exit the long positions and open short positions in the opposite direction (expecting a movement of 30-35 pips in the opposite direction from the level). It's best to return to buying the pair on corrections and significant dips in USD/JPY. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning an upward move from it.

Scenario No. 2: I also plan to buy USD/JPY today in the event of two consecutive tests of the price at 159.13 when the MACD indicator is in the oversold area. This will limit the downward potential of the pair and lead to a market reversal upwards. A rise to the opposite levels of 159.28 and 159.62 can be expected.

Sell Scenarios

Scenario No. 1: I plan to sell USD/JPY today only after the 159.13 level is updated (red line on the chart), which will trigger a quick decline in the pair. The key target for sellers will be the 158.80 level, where I plan to exit the shorts and immediately buy in the opposite direction (expecting a 20-25-pip move in the opposite direction from that level). It is better to sell as high as possible towards the level of 160 yen. Important! Before selling, ensure the MACD indicator is below the zero mark and just beginning its downward movement.

Scenario No. 2: I also plan to sell USD/JPY today in the event of two consecutive tests of the price at 159.28 when the MACD indicator is in the overbought area. This will limit the upward potential of the pair and lead to a market reversal downwards. A decrease to the opposite levels of 159.13 and 158.80 can be expected.

What Is On The Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the expected price where Take Profit can be set, or profits can be secured, 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 expected price where Take Profit can be set, or profits can be secured, as further decline below this level is unlikely;
• MACD Indicator. It is important to be guided by overbought and oversold zones upon entering the market.

Important: Beginner traders in the Forex market need to be very cautious when making entry decisions. It is best to be out of the market before important fundamental reports are released to avoid being caught in sharp price fluctuations. If you choose to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember, for successful trading, it is essential to have a clear trading plan, like the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for intraday traders.