Trade analysis and tips on trading the Japanese yen

The test of the 147.71 price occurred when the MACD indicator had just started moving downward from the zero mark, which confirmed a correct entry point for selling the dollar. However, a major drop in the pair never materialized.

Weak U.S. PMI data put pressure on the dollar and supported the yen, as did the dovish stance of Fed Chair Jerome Powell. The published manufacturing and services PMI came in below expectations, increasing concerns about slowing economic growth in the U.S., which led to dollar weakness. The Japanese yen, traditionally considered a safe-haven currency, benefited from this situation, although it did not cause a significant shift in market sentiment. In addition, Powell's speech, in which he stressed the need for a cautious approach to future monetary policy, also supported the yen. Powell noted that the Fed would closely monitor incoming economic data and respond accordingly, which markets interpreted as a signal of potential rate cuts.

As for intraday strategy, I will focus mainly on Scenarios No. 1 and No. 2.

Buy scenarios

Scenario No. 1: I plan to buy USD/JPY today at an entry point around 148.15 (green line on the chart), targeting 148.46 (thicker green line on the chart). Around 148.46, I intend to exit long positions and open short positions in the opposite direction (expecting a 30–35 point reversal from the level). It is best to return to buying the pair during corrections and significant pullbacks of USD/JPY. Important! Before buying, make sure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today in the case of two consecutive tests of the 147.96 price when the MACD is in the oversold area. This will limit the pair's downward potential and trigger a reversal upward. Growth can be expected toward the opposite levels of 148.15 and 148.46.

Sell scenarios

Scenario No. 1: I plan to sell USD/JPY today only after the 147.96 level is updated (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be 147.62, where I plan to exit shorts and immediately open longs in the opposite direction (expecting a 20–25 point reversal from the level). It is best to sell from as high as possible. Important! Before selling, make sure the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today in the case of two consecutive tests of the 148.15 level when the MACD is in the overbought area. This will limit the pair's upward potential and trigger a reversal downward. A decline can be expected toward the opposite levels of 147.96 and 147.62.

What's on the chart:

• Thin green line – entry price for buying the instrument.
• Thick green line – estimated price for setting Take Profit or fixing profit manually, as further growth above this level is unlikely.
• Thin red line – entry price for selling the instrument.
• Thick red line – estimated price for setting Take Profit or fixing profit manually, as further decline below this level is unlikely.
• MACD indicator. When entering the market, it is important to use overbought and oversold zones as guidance.

Important: Beginner forex traders should be very cautious when making entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price swings. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you ignore money management and trade with large volumes.

And remember, successful trading requires a clear trading plan, like the one I have outlined above. Spontaneous trading decisions based on the current market situation are an inherently losing strategy for an intraday trader.