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The price test at 157.40 occurred as the MACD indicator began moving up from the zero line, confirming a correct entry point to buy the dollar. As a result, the pair rose about 30 pips.
However, today the yen regained the lead, gaining 0.6% and pushing USD/JPY down to 156.38 during Asian trading. Several factors converged behind this strength. First, the traditional end-of-quarter inflows created technical support for the yen. Second — and crucially — the market received another set of unambiguous signals from Japanese authorities. Senior FX official Atsushi Mimura publicly confirmed that the prime minister, the finance minister of Japan, and the U.S. side sent a very clear message to the market that further yen depreciation is unacceptable. Prime Minister Sanae Takaichi added that U.S. President Donald Trump, in their recent meeting, shared concerns about the yen's weakness. The political context was rare: Tokyo and Washington are effectively showing a unified position, and the market felt it.
The yen has strengthened roughly 3.5% this quarter, largely as a result of the joint Japan-U.S. intervention in July — the first in fifteen years. Now expectations for the Bank of Japan are adding to the picture. After raising the policy rate to 1.25% earlier this month, market talk has intensified that another step up could come as early as October. Policy normalization combined with political support for the yen on both sides of the Pacific creates an environment in which further upside for USD/JPY looks increasingly constrained. In my view, yen sellers will act with growing caution while this fundamental backdrop persists.
For intraday strategy, I will mainly rely on executing Scenarios No. 1 and No. 2.
No 1: I plan to buy USD/JPY today around 157.16 (green line on the chart), targeting 157.51 (thicker green line on the chart). Around 157.51 I plan to exit long positions and open short positions in the opposite direction (expecting a 30–35 pip counter-move). It's best to return to buying the pair on corrections and significant pullbacks. Important: before buying, ensure the MACD is above zero and has just begun rising.
No 2: I also plan to buy USD/JPY if the price tests 156.87 twice in a row while the MACD is in the oversold area. This would limit the pair's downside potential and trigger an upward reversal. Expect moves to 157.16 and 157.51.
No 1: I plan to sell USD/JPY today only after the 156.87 level is breached (red line on the chart), which should lead to a rapid decline. The sellers' key target will be 156.47, where I plan to exit shorts and immediately open longs in the opposite direction (expecting a 20–25 pip counter-move). Sellers can return at any moment—it only takes a hint from the central bank. Important: before selling, ensure the MACD is below zero and has just begun falling.
No 2: I also plan to sell USD/JPY if the price tests 157.16 twice in a row while MACD is in the overbought area. This would limit upside potential and trigger a reversal downward. Expect falls toward 156.87 and 156.47.
Important: Beginner traders in the Forex market need to be very cautious when making entry decisions. It is best to stay out of the market ahead of significant fundamental reports to avoid being caught in sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you do not employ money management practices and trade large volumes.
Also, remember that successful trading requires a clear trading plan, similar to the one provided above. Making spontaneous trading decisions based on current market conditions is inherently a losing strategy for intraday traders.
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