Analysis of Trades and Trading Tips for the Japanese Yen

The 158.34 price level was tested when the MACD indicator had just started moving down from the zero line, confirming the validity of the entry point for selling the dollar. As a result, the pair declined toward the target level of 158.11.

For the yen, the next direction will be determined by the minutes of the September Fed meeting, as the only significant U.S. economic release expected is the consumer credit report, meaning that the main focus will be on the policymakers' tone. The yen usually benefits from selling risky assets, but the current situation is unusual. The morning Japanese data were mixed. Wage growth came in at 3.8% against a forecast of 3.7%, although it had been 4.3% a month earlier. The leading economic indicators index came in at 118.0 versus the expected 118.1, although it had stood at 117.7 the previous month. This suggests that the economy is not deteriorating, but neither is it gaining momentum. Against this backdrop, the Bank of Japan continues its cautious normalization process, while Ueda had previously highlighted the risks of rising prices.

Hawkish Fed minutes will restore demand for the dollar and push the pair higher, despite the yen's safe-haven status. High oil prices are adding pressure, as Japan imports energy resources. I believe the yen will have a chance for a significant recovery only if the U.S. bond market stabilizes and policymakers' tone proves softer than expected. For now, cautious bets on a downside correction remain the only reasonable scenario ahead of the release of the minutes.

As for the intraday strategy, I will focus more on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, I plan to buy USD/JPY when the entry point is reached in the 158.40 level (green line on the chart), with a target of rising toward 158.65 (thicker green line on the chart). Around 158.65, I will exit the long position and open short positions in the opposite direction, targeting a move of 30–35 points in the opposite direction from the level. A rise in the pair can be expected today, but the upside potential is rather limited. Important! Before buying, make sure that the MACD indicator is above the zero line and has only just started rising from it.

Scenario No. 2: Today, I also plan to buy USD/JPY if the price tests 158.24 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal to the upside. A rise toward the opposite levels of 158.40 and 158.65 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell USD/JPY after the 158.24 level is broken to a new low (red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 157.96, where I will exit the short position and immediately open a long position in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair will return today in the event of central bank intervention. Important! Before selling, make sure that the MACD indicator is below the zero line and has only just started declining from it.

Scenario No. 2: Today, I also plan to sell USD/JPY if the price tests 158.40 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal to the downside. A decline toward the opposite levels of 158.24 and 157.96 can be expected.

What Is Shown on the Chart:

• Thin green line – indicates the entry price at which the trading instrument can be bought;
• Thick green line – indicates the expected price at which Take Profit orders can be placed or profits can be taken manually, as further growth above this level is unlikely;
• Thin red line – indicates the entry price at which the trading instrument can be sold;
• Thick red line – indicates the expected price at which Take Profit orders can be placed or profits can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold areas into account.

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

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