Analysis of trades and trading tips for the Japanese yen

The price test at 159.10 occurred when the MACD indicator had moved significantly below the zero mark, limiting the pair's downward potential. For this reason, I did not sell the dollar. Two tests of the price level 159.25 occurred while MACD was in the overbought area, prompting the implementation of the second Sell Scenario for the dollar; however, the pair did not decline, resulting in losses.

The dollar briefly declined in response to the slowdown in American inflation; however, a large sell-off did not occur. The annual Consumer Price Index fell to 3.4% from June's 3.5%, while core inflation decreased to 2.5% from 2.6%, briefly weakening the American currency. At the same time, the monthly figures exactly matched forecasts: overall CPI rose 0.1%, and core CPI rose 0.2%, and this absence of surprise kept the market from sharp moves, easing some tension after the Federal Reserve's July meeting. For the yen, the short-term weakening of the dollar became a reason for strengthening, since the inflation slowdown reduces the probability of further Fed tightening and slightly narrows the gap in approaches with the cautious Bank of Japan. Nevertheless, the alignment of the data with forecasts prevented the USD/JPY pair from making a notable move, and the decline was moderate.

Regarding the intraday strategy, I will rely more on implementing Scenarios #1 and #2.

Buy scenarios

Scenario #1: I plan to buy USD/JPY today when the entry point around 159.46 (green line on the chart) is reached, targeting a rise to the level of 159.76 (the thicker green line on the chart). Around 159.76 I plan to exit long positions and open short positions in the opposite direction (expecting a movement of 30–35 pips in the opposite direction from the level). It is best to return to buying the pair on corrections and significant drawdowns of USD/JPY. Important! Before buying, make sure that the MACD indicator is above the zero mark and is just starting its rise from it.

Scenario #2: I also plan to buy USD/JPY today in the event of two consecutive tests of the price at 159.28, with the MACD indicator in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. A rise to opposing levels 159.46 and 159.76 can be expected.

Sell scenarios

Scenario #1: I plan to sell USD/JPY today only after the level 159.28 is updated (red line on the chart), which will lead to a rapid decline of the pair. The key target for sellers will be the level 159.00, where I plan to exit shorts and also immediately open longs in the opposite direction (expecting a movement of 20–25 pips in the opposite direction from the level). Sellers will return at any moment; it only takes a hint from the central bank. Important! Before selling, make sure that the MACD indicator is below the zero mark and is just starting its decline from it.

Scenario #2: I also plan to sell USD/JPY today in the event of two consecutive tests of the price at 159.46, when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline to the opposing levels of 159.28 and 159.00 can be expected.

What the Chart Shows:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated price where take profit can be set, or profit can be realized, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated price where take profit can be set, or profit can be realized, 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 forex traders need to make entry decisions very cautiously. Before key fundamental reports are released, it is best to stay out of the market 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 practice money management and trade large volumes.

And remember, successful trading requires a clear trading plan, as outlined above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.