Trade analysis and tips for trading the Japanese yen

The test of the 158.19 price level occurred when the MACD indicator had just begun moving upward from the zero mark, confirming the correct entry point for buying the dollar. As a result, the pair increased by 25 points.

Today, in the second half of the day, the main focus of analysts and market participants will be on the upcoming U.S. inflation statistics. One of the key events will be the release of data on the Consumer Price Index (CPI). This indicator represents the primary measure of inflationary pressure and is closely monitored by the Federal Reserve. Any deviation from forecast values may cause increased volatility in the foreign exchange market, strengthening or weakening the dollar.

In addition, a speech by FOMC member Michelle Bowman is scheduled. Her remarks will be carefully analyzed for new signals regarding the regulator's upcoming policy steps, as well as her views on developments in the Middle East in the context of potential increases in inflationary pressure.

As for the intraday strategy, I will rely mainly on the implementation of scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today I plan to buy USD/JPY when the price reaches the entry point around 158.53 (green line on the chart) with a target of 159.03 (thicker green line on the chart). Around 159.03, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from that level). The pair may rise today after strong economic data.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 if there are two consecutive tests of the 158.26 level while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. Growth toward the opposite levels 158.53 and 159.03 can then be expected.

Sell Signal

Scenario No. 1: Today I plan to sell USD/JPY after the 158.26 level is updated (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 157.78, where I will exit short positions and also open buy positions in the opposite direction (expecting a 20–25 point move upward from that level). Pressure on the pair may return today if U.S. inflation declines sharply.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 if there are two consecutive tests of the 158.53 level while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels 158.26 and 157.78 can then be expected.

What's on the chart:

• Thin green line – the entry price at which the trading instrument can be bought.
• Thick green line – the estimated price where Take Profit can be placed or profits can be manually locked in, since 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 estimated price where Take Profit can be placed or profits can be manually locked in, since further decline below this level is unlikely.
• MACD indicator – when entering the market, it is important to consider the overbought and oversold zones.

Important:Beginner traders in the Forex market should make entry decisions very carefully. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp exchange rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can very quickly lose your entire deposit, especially if you do not use proper money management and trade with large volumes.

Remember that successful trading requires a clear trading plan, like the one presented above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for an intraday trader.