Trade Review and Tips for Trading the Japanese Yen

The test of the 149.34 level occurred when the MACD indicator had just started moving downward from the zero line, confirming a valid entry point for selling the dollar. However, a significant drop in the pair did not materialize.

As the USD/JPY pair continues its upward trend, investors are actively searching for a signal that could reverse this momentum. The dollar may receive further support from the Fed's actions and, more importantly, from John Williams's speech, which is the key event of the day. If Williams clearly confirms the commitment to maintaining current interest rates to combat inflation, the dollar could strengthen further against the yen. Otherwise, if his rhetoric appears cautious or vague, the dollar may lose some ground heading into the weekend.

As for the intraday strategy, I will primarily focus on executing Scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy USD/JPY today upon reaching the entry point at 149.56 (green line on the chart) with a target of 150.11 (thicker green line on the chart). At 150.11, I will exit long positions and open short positions in the opposite direction, expecting a 30–35 point pullback. This setup assumes continued bullish correction in the pair. Important: Before buying, make sure the MACD indicator is above the zero line and just beginning to rise.

Scenario #2: I also plan to buy USD/JPY if the price tests the 149.26 level twice, while the MACD is in oversold territory. This would limit the pair's downward potential and prompt a reversal. A move back toward 149.56 and 150.11 can then be expected.

Sell Signal

Scenario #1: I plan to sell USD/JPY after a break below 149.26 (red line on the chart), which would likely trigger a quick decline. The main target for sellers will be 148.69, where I will exit shorts and open long positions in the opposite direction, aiming for a 20–25 point rebound. Downside pressure on the pair could emerge at any moment today. Important: Before selling, confirm that the MACD indicator is below the zero line and just starting to fall from it.

Scenario #2: I also plan to sell USD/JPY today if there are two consecutive tests of the 149.56 level, with the MACD in overbought territory. This would limit further upward movement and trigger a downward reversal. A decline toward 149.26 and 148.69 is then expected.

Chart Legend:

• Thin green line – entry price for long positions
• Thick green line – estimated Take Profit level or a logical place to lock in profits, as further growth is unlikely above this level
• Thin red line – entry price for short positions
• Thick red line – estimated Take Profit level or a logical place to lock in profits, as further decline is unlikely below this level
• MACD indicator – use overbought/oversold zones to guide trade entries

Important: Beginner Forex traders should exercise extreme caution when making entry decisions. It is best to stay out of the market ahead of major economic reports to avoid sudden price swings. If you choose to trade during news events, always set stop-loss orders to limit losses. Trading without stop-losses can lead to rapid account depletion, especially if you don't apply risk management and are trading large volumes.

And remember: successful trading requires a well-defined plan, like the one outlined above. Spontaneous trading decisions based on short-term market moves are generally a losing strategy for intraday traders.