Trade Review and Advice on Trading the Japanese Yen

The test of the 153.45 price level occurred when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. For this reason, I did not buy the dollar.

The growth of the Japanese yen appears to have stalled. From a technical perspective, a gradual reversal toward strengthening and an upward correction in the USD/JPY pair is taking place, which could be driven by today's U.S. inflation data. The reports have the potential to trigger another surge in volatility in USD/JPY. The focus will be on January's Consumer Price Index (CPI) and the Core CPI.

The dynamics of the Core CPI are of particular importance. A slowdown in this indicator may be interpreted as a sign of easing inflationary pressure, which, in turn, could prompt markets to revise their expectations regarding future Federal Reserve interest rate changes. In such a scenario, where the prospect of a more accommodative monetary policy becomes more likely, the U.S. dollar typically loses its appeal to investors. This could lead to a further decline in USD/JPY.

As for the intraday strategy, I will rely more 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 153.70 (green line on the chart), targeting growth to 154.28 (thicker green line on the chart). Around 154.28, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move from that level). The pair can be expected to rise today after strong U.S. data.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 in case of two consecutive tests of the 153.39 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. Growth toward the opposite levels of 153.70 and 154.28 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell USD/JPY after a breakout below the 153.39 level (red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 152.94, where I will 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 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 in case of two consecutive tests of the 153.70 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. A decline toward the opposite levels of 153.39 and 152.94 can be expected.

What's on the Chart:

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

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of major 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 use proper money management and trade large volumes.

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