Analysis of Trades and Trading Tips for the Japanese Yen

The first test of the 148.36 level occurred when the MACD indicator had already moved well below the zero line, which limited the pair's downside potential. Shortly afterward, there was another test of 148.36, coinciding with the MACD being in oversold territory, which allowed Scenario #2 for buying the dollar to play out. As a result, the pair rose by 45 points.

Strong data on U.S. building permits and housing starts strengthened the dollar and weakened the Japanese yen. This unexpected surge in activity in the real estate sector is an important indicator of the health of the U.S. economy, reflecting sustained demand and builder confidence. The rise in permits signals a future increase in housing supply, which could help curb inflation in the long term. Meanwhile, the Japanese yen is facing significant challenges. Additional pressure stems from Japan's lack of a trade agreement with the U.S., which may further strain relations between the two countries. Investors should closely monitor the Bank of Japan's actions, as they will likely serve as a response to these developments.

Buy Scenario

Scenario #1: Today, I plan to buy USD/JPY upon reaching the entry point at 148.41 (indicated by the green line on the chart), with the goal of rising toward 149.04 (represented by the thicker green line on the chart). Around 149.04, I plan to exit long positions and open short ones in the opposite direction, expecting a 30–35 point pullback. It's best to buy the pair during corrections and significant dips in USD/JPY.

Important! Before making a purchase, ensure the MACD indicator is above the zero line and is just starting to rise from it.

Scenario #2: I also plan to buy USD/JPY if 147.85 is tested twice consecutively while the MACD is in oversold territory. This will limit the pair's downside potential and trigger a market reversal upward. A rise toward the opposite levels, 148.41 and 149.04, can be expected.

Sell Scenario

Scenario #1: I plan to sell USD/JPY only after 147.85 (red line on the chart) is broken, which would lead to a swift decline in the pair. The key target for sellers will be 147.33, where I plan to exit short positions and immediately open long ones in the opposite direction, expecting a 20–25 point bounce. Strong pressure on the pair today is unlikely.

Important! Before selling, ensure the MACD indicator is below the zero line and just beginning to decline from it.

Scenario #2: I also plan to sell USD/JPY if 148.41 is tested twice consecutively while the MACD is in overbought territory. This will limit the pair's upward potential and trigger a market reversal to the downside. A decline toward the opposite levels, 147.85 and 147.33, can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.