Analysis of Trades and Trading Tips for the Japanese Yen

The test of the 157.20 price coincided with the moment when the MACD indicator moved significantly above the zero mark, which limited the pair's upward potential. For this reason, I did not buy the dollar.

The yen strengthened against the dollar after the Bank of Japan hinted at raising the key interest rate next month amid concerns about inflation risks from the conflict in the Middle East. In the minutes from the April meeting presented today, there is a clear indication of concern among some members of the Bank of Japan's board. Several participants expressed a consolidated position on the need to maintain heightened vigilance regarding potential inflation risks. Special attention was given to factors contributing to accelerating price growth, among which the Middle Eastern conflict stands out for its potential impact on global energy prices and, consequently, inflation in Japan. Against this backdrop, the review clearly indicated the need to consider further measures, including the possibility of raising interest rates, to stabilize the price situation.

Regarding the intraday strategy, I will focus more on implementing scenarios #1 and #2.

Buy Scenarios

Scenario #1: I plan to buy USD/JPY today at an entry price around 157.52 (green line on the chart), with a target at 158.15 (thicker green line on the chart). At 158.15, I plan to exit the buys and immediately sell in the opposite direction, expecting a move of 30-35 pips from the entry point. It is best to return to buying the pair during corrections and significant pullbacks in USD/JPY. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario #2: I also plan to buy USD/JPY today if there are two consecutive tests of 157.14 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. One can expect growth towards the opposite levels of 157.52 and 158.15.

Sell Scenarios

Scenario #1: I plan to sell USD/JPY today only after the 157.14 level is updated (red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be the level of 156.63, where I plan to exit the short positions and immediately buy in the opposite direction, expecting a movement of 20-25 pips in the opposite direction from the level. Sellers could return at any moment; any hint from the central bank could trigger this. Important! Before selling, ensure the MACD indicator is below the zero mark and just starting its decline from it.

Scenario #2: I also plan to sell USD/JPY today if there are two consecutive tests of 157.52 when the MACD indicator is in the overbought area. This will limit the upward potential of the pair and lead to a downward market reversal. One can expect a decline toward the opposite levels of 157.14 and 156.63.

What is on the Chart:

• The thin green line – entry price at which the trading instrument can be bought;
• The thick green line – approximate price where take profit can be set or to realize profit, as further growth above this level is unlikely;
• The thin red line – entry price at which the trading instrument can be sold;
• The thick red line – approximate price where take profit can be set or to realize profit, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to be guided by overbought and oversold zones.

Important: Beginner traders in the Forex market need to make entry decisions very cautiously. It is best to stay out of the market before important fundamental reports to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade in large volumes.

And remember, for successful trading, it is essential to have a clear trading plan, as outlined above. Making impulsive trading decisions based on the current market situation is fundamentally a losing strategy for an intraday trader.