Analysis of transactions and tips on trading the Japanese yen
The price test of 155.94 came when the MACD indicator was starting to move down from zero, which confirmed the scenario for the dollar sale. However, losses were recorded on the deal since it never came to a downward movement. Strong statistics on activity in the US service sector led to another pair strengthening. Sales of 30-year Japanese bonds have already taken place today, which did not affect market sentiment. The pair will continue to grow, and the ongoing corrections will be an additional reason to buy the dollar at more attractive prices. As for the intraday strategy, I will rely more on implementing scenarios No. 1 and No. 2.
Buy signal
Scenario No. 1: I plan to buy USD/JPY today when I reach the entry point of 156.38 (green line) to grow to 157.64 (thicker green line on the chart). In the area of 157.64, I will exit purchases and open sales in the opposite direction (counting on a movement of 30-35 points in the opposite direction from the level). Today, the pair’s growth can be counted on as part of continuing the trend. Important! Before buying, ensure the MACD indicator is above the zero mark and is just starting to grow from it.
Scenario No. 2: I also plan to buy USD/JPY today for two consecutive price tests of 155.73 when the MACD indicator will be in the oversold area. This will limit the pair’s downward potential and lead to an upward market reversal. We can expect an increase to the opposite levels of 156.38 and 157.64.
Sell signal
Scenario No. 1: I plan to sell USD/JPY today only after updating the level of 155.73 (the red line on the chart), leading to a rapid decline in the pair. The key target of sellers will be the level of 154.84, where I’m going to exit sales, as well as immediately open purchases in the opposite direction (counting on a movement of 20-25 points in the opposite direction from the level). The pressure on the pair may return in case of an unsuccessful consolidation in the area of the daily maximum. Important! Before selling, ensure the MACD indicator is below the zero mark and is just beginning to decline.
Scenario No. 2: I also plan to sell USD/JPY today for two consecutive price tests of 156.38 when the MACD indicator is overbought. This will limit the upward potential of the pair and lead to a downward reversal of the market. We can expect a decline to the opposite levels of 155.73 and 154.84.
What’s on the Chart:
Thin green line: Entry price for buying the trading instrument.
Thick green line: Suggested price for setting Take Profit or manually fixing profits, as further growth above this level is unlikely.
Thin red line: Entry price for selling the trading instrument.
Thick red line: Suggested price for setting Take Profit or manually fixing profits, as further decline below this level is unlikely.
MACD Indicator: Considering overbought and oversold zones when entering the market is important.
Important: Beginner Forex traders should be cautious when making market entry decisions. It is best to stay out of the market before the release of important fundamental reports to avoid sudden price swings. If you decide to trade during news releases, always set stop orders to minimize losses. You must set stop orders to avoid losing your entire deposit, especially if you do not use money management and trade with large volumes.
Remember that successful trading requires a clear plan like the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.
The material has been provided by InstaForex Company – www.instaforex.com
