Trade Analysis and Trading Advice for the Japanese Yen

The test of the 163.79 price level occurred when the MACD indicator had just started moving upward from the zero line, which confirmed the validity of the entry point for buying the US dollar. As a result, the pair rose by 15 points.

Attention will now turn to the US trade balance report. This release will provide insight into the extent to which the volume of imported goods exceeds the volume of exported goods. Analysing the dynamics of this report will allow traders to assess the competitiveness of US products in global markets. An increase in the indicator could support further gains in the dollar.

After the release of the trade balance data, market participants will closely monitor the consumer confidence index. This indicator is generally considered a leading indicator, as it reflects consumer sentiment and expectations regarding future economic conditions and personal financial prospects. High consumer confidence is usually accompanied by increased consumer spending, which represents one of the most significant components of the US economy. Conversely, a decline in this indicator may signal a slowdown in business activity and a decrease in consumer demand.

The Richmond Fed Manufacturing Index will also be of interest, as it will provide information about current manufacturing activity in the region covered by the Federal Reserve Bank of Richmond. Like other regional manufacturing indices, this indicator helps assess overall industrial trends, including production volumes, new orders, employment, and prices. Positive readings and improving index dynamics could lead to further growth in the USD/JPY pair.

Regarding the intraday strategy, I will primarily focus on the implementation of Scenario #1 and Scenario #2.

Scenario #1:

Today, I plan to buy USD/JPY once the entry point around 164.06 is reached (the green line on the chart), with a target move towards 164.29 (the thicker green line on the chart). Around 164.29, I will exit long positions and open short positions in the opposite direction, expecting a move of 30–35 points from the level. A rise in the pair today is possible, but the upward potential is relatively limited.

Important: Before buying, make sure that the MACD indicator is above the zero line and has only just started moving upward from it.

Scenario #2:

I also plan to buy USD/JPY today if there are two consecutive tests of the 163.88 price level while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and trigger a reversal higher. A move towards the opposite levels of 164.06 and 164.29 can then be expected.

Scenario #1:

Today, I plan to sell USD/JPY after the 163.88 level is updated (the red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 163.63, where I will exit short positions and immediately open long positions in the opposite direction, expecting a move of 20–25 points from the level. Selling pressure on the pair may return today if the central bank intervenes.

Important: Before selling, make sure that the MACD indicator is below the zero line and has only just started moving downward from it.

Scenario #2:

I also plan to sell USD/JPY today if there are two consecutive tests of the 164.06 price level while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and trigger a reversal lower. A decline towards the opposite levels of 163.88 and 163.63 can then be expected.

• Thin green line — the entry price at which the trading instrument can be bought.
• Thick green line — the estimated price level where Take Profit orders can be placed or profits can be manually secured, as further growth above this level is considered unlikely.
• Thin red line — the entry price at which the trading instrument can be sold.
• Thick red line — the estimated price level where Take Profit orders can be placed or profits can be manually secured, as further decline below this level is considered unlikely.
• MACD indicator — when entering the market, it is important to consider overbought and oversold zones.

Important: Beginner Forex traders should be extremely cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid exposure to sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimise losses. Without stop-loss orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade with large position sizes.

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