Trade Review and Trading Advice for the Japanese Yen

Due to low market volatility, the price did not reach the levels I identified during the first half of the day. As a result, I ended the session without any trades.

In the second half of the day, a spike in volatility is expected, although it is unlikely to be critical for the USD/JPY pair, as markets are still anticipating potential intervention from the Bank of Japan. Nevertheless, it is important to review the upcoming data. The release sequence begins with the U.S. Nonfarm Payrolls report for May. This indicator is closely monitored as a barometer of the U.S. economy, reflecting job creation outside the agricultural sector. Immediately after the employment report, the unemployment rate will be released. The final key release will be average hourly earnings. This indicator is of primary importance to the Federal Reserve, as wage growth is one of the main drivers of inflation. Higher inflation increases the likelihood of interest rate hikes, which generally strengthens the U.S. dollar against the Japanese yen.

Regarding the intraday strategy, I will mainly rely on scenarios #1 and #2.

Buy Signal

Scenario #1:

Today, I plan to buy USD/JPY when the entry point is reached around 160.01 (green line on the chart), targeting a rise toward 160.35 (thicker green line on the chart). At 160.35, I will exit long positions and open short positions in the opposite direction, expecting a 30–35 point pullback. A rise in the pair is possible in the case of negative news regarding agreements and strong U.S. data. Important! Before buying, ensure that the MACD indicator is above the zero line and has just started rising from it.

Scenario #2:

I will also consider buying USD/JPY if there are two consecutive tests of the 159.88 level while the MACD indicator is in oversold territory. This would limit downward potential and trigger a reversal to the upside. In this case, a move toward 160.01 and 160.35 can be expected.

Sell Signal

Scenario #1:

I plan to sell USD/JPY after a breakdown below 159.88 (red line on the chart), which would lead to a sharp decline in the pair. The key target for sellers is 159.49, where I will exit short positions and open long positions in the opposite direction, expecting a 20–25 point rebound. Selling pressure is expected to return in the case of weak data releases. Important! Before selling, ensure that the MACD indicator is below the zero line and has just started declining from it.

Scenario #2:

I will also consider selling USD/JPY if there are two consecutive tests of the 160.01 level while the MACD indicator is in overbought territory. This would limit upward potential and trigger a reversal to the downside. In this case, a decline toward 159.88 and 159.49 can be expected.

What is shown on the chart:

• Thin green line – entry price for buy trades
• Thick green line – estimated take-profit level or manual profit-taking area, as further upside above this level is unlikely
• Thin red line – entry price for sell trades
• Thick red line – estimated take-profit level or manual profit-taking area, as further downside below this level is unlikely
• MACD indicator – trading decisions should be guided by overbought and oversold zones

Important Note

Beginner Forex traders should be extremely cautious when entering the market. Before the release of important fundamental data, it is best to stay out of the market to avoid sharp price volatility. If you decide to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss protection, you may quickly lose your entire deposit, especially if proper money management is not used and large position sizes are traded.

Remember that successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based on current market conditions are inherently a losing strategy for intraday traders.