11.02.202608:30 Forex Analysis & Reviews: USD/JPY: Simple Trading Tips for Beginner Traders on February 11. Analysis of Yesterday's Forex Trades

Analysis of Trades and Tips for Trading the Japanese Yen

The test of the 155.11 price level occurred when the MACD indicator had moved significantly below the zero mark, which limited the pair's downside potential. For this reason, I did not sell dollars and missed the entire downward movement.

The weakening of the American currency was triggered by disappointing news that December retail sales in the United States showed no growth, prompting renewed buying of the Japanese yen. This result surprised financial markets, which had been expecting a revival in consumer activity ahead of the New Year's holidays. On the other hand, stagnation in retail sales allows the Federal Reserve to achieve its inflation target. Sustained consumer demand is traditionally one of the factors that support inflationary pressure. A decrease in demand may slow the rate of price growth, which, in turn, could push the Fed towards implementing a more accommodative monetary policy. Given that many traders were wary of potential currency interventions by the Bank of Japan, the sharp dollar decline following the data provided a good reason to buy the Japanese yen.

Regarding the intraday strategy, I will primarily rely on the realization of Scenarios #1 and #2.

Buy Scenarios

• Scenario #1: I plan to buy USD/JPY today upon reaching the entry point at 153.27 (green line on the chart), targeting a move to 153.83 (thicker green line on the chart). Near 153.83, I intend to exit my long positions and open short positions in the opposite direction (anticipating a 30-35-pip move in the opposite direction from the level). It is best to return to buying the pair on corrections and significant pullbacks in USD/JPY. Important! Before buying, ensure the MACD indicator is above the zero mark and just starting to rise from it.
• Scenario #2: I also plan to buy USD/JPY today if the price tests 152.83 twice and the MACD indicator is in the oversold zone. This will limit the pair's downside potential and lead to an upward market reversal. An increase towards the opposing levels of 153.27 and 153.83 can be expected.

Sell Scenarios

• Scenario #1: I plan to sell USD/JPY today only after it breaks the 152.83 level (red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be the level of 152.34, where I intend to exit my shorts and immediately buy in the opposite direction (anticipating a movement of 20-25 pips in the opposite direction from the level). It's better to sell as high as possible. Important! Before selling, ensure the MACD indicator is below the zero mark and just starting to decline from it.
• Scenario #2: I also plan to sell USD/JPY today in the event of two consecutive tests of the price at 153.27 when the MACD indicator is in the overbought zone. This will limit the upward potential of the pair and lead to a downward market reversal. A decrease towards the opposing levels of 152.83 and 152.34 can be expected.

What's on the Chart:

The thin green line represents the entry price at which one can buy the trading instrument;

The thick green line represents the approximate price where one can set Take Profit or secure profits, as further growth above this level is unlikely;

The thin red line represents the entry price at which one can sell the trading instrument;

The thick red line represents the approximate price where one can set Take Profit or secure profits, as further decline below this level is unlikely;

The MACD indicator: when entering the market, it is important to consider overbought and oversold zones.

Important: Beginner traders in the Forex market should be very careful when making entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember, for successful trading, it is essential to have a clear trading plan, as outlined above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for an intraday trader.