Trade Review and Advice on Trading the Japanese Yen

The test of the 155.26 price level occurred when the MACD indicator had just begun moving upward from the zero line, confirming a proper entry point for buying the dollar. As a result, the pair rose by 80 points.

The Japanese yen continued to decline following reports in local media that Japan's Prime Minister, Sanae Takaichi, expressed concerns about a possible further interest rate hike. This statement, which initially leaked to the press, triggered a wave of anxiety among investors who fear that tighter monetary policy could slow the growth of Japan's economy, which has only recently begun to show signs of recovery after a prolonged period of stagnation. The market interpreted this news as a signal of a possible softening in the Bank of Japan's stance on further rate increases, despite existing inflation risks.

The Prime Minister's concerns, voiced during a meeting with the central bank governor, were interpreted as a factor that could pause or slow the process of policy normalization, which in turn negatively affected the yen's exchange rate. This situation places the Bank of Japan before a difficult choice: fight inflation by raising rates further, risking economic growth, or continue supporting the economy while watching the national currency depreciate further.

In the second half of the day, U.S. consumer confidence data and the home price index for the 20 largest cities are expected. Speeches by Federal Reserve representatives are also scheduled.

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

Buy Signal

Scenario No. 1: Today, I plan to buy USD/JPY upon reaching the entry point around 155.95 (green line on the chart), targeting growth to 156.39 (thicker green line on the chart). Around 156.39, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move from that level). A rise in the pair today can be expected after a hawkish tone from the Federal Reserve.Important: Before buying, make sure the MACD indicator is above the zero line 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 155.77 level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upward. A rise toward the opposite levels of 155.95 and 156.39 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell USD/JPY after a breakout below the 155.77 level (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 155.51, where I intend to exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point move from that level). Pressure on the pair will return in the event of weak U.S. reports.Important: Before selling, make sure the MACD indicator is below the zero line 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 155.95 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels of 155.77 and 155.51 can be expected.

Chart Explanation:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated Take Profit level or area to lock in profits manually, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated Take Profit level or area to lock in profits manually, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to rely on overbought and oversold zones.

Important for Beginner Forex Traders

Beginner Forex traders should make entry decisions with extreme caution. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit — especially if you do not apply proper money management and trade large volumes.

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