The test of the 159.28 level occurred when the MACD had already moved significantly below the zero line, which limited the pair's downward potential.
The yen gained quite well, but its decline was quickly bought up ahead of important US data. The market is now awaiting a key US inflation report, including the Consumer Price Index and its core measure, excluding food and energy prices. These data directly shape expectations for Fed policy, as accelerating prices strengthen the case for tighter monetary policy, while the core measure is considered the most accurate indicator of persistent price pressures. A sharp increase in inflation would support the dollar through higher US Treasury yields and growing expectations of a hawkish stance by the central bank. For the yen, such a scenario carries a risk of weakening, as a stronger dollar amid high inflation would widen the divergence between the Fed's approach and the much more cautious stance of the Bank of Japan. This difference traditionally weighs on the Japanese currency, and a strong report could push USD/JPY higher. Weak inflation, by contrast, would weaken the dollar and allow the yen to recover some of its lost ground.
As for the intraday strategy, I will focus more on the implementation of Scenarios #1 and #2.
Scenario #1: Today, I plan to buy USD/JPY when the entry point is reached around 159.25 (the green line on the chart), with a target of a rise to 159.63 (the thicker green line on the chart). Around 159.63, I will exit the long position and open a short position in the opposite direction, targeting a move of 30–35 points from the level. A rise in the pair today is possible, but the outlook is relatively uncertain. Important: Before buying, make sure that the MACD indicator is above the zero line and is only beginning to rise from it.
Scenario #2: Today, I also plan to buy USD/JPY if the price tests 159.10 twice consecutively while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and lead to a reversal higher. A rise toward the opposite levels of 159.25 and 159.63 can be expected.
Sell SignalScenario #1: Today, I plan to sell USD/JPY after the price breaks below 159.10 (the red line on the chart), which could lead to a rapid decline in the pair. The key target for sellers will be 158.79, where I will exit the short position and immediately open a long position in the opposite direction, targeting a move of 20–25 points from the level. Downward pressure on the pair will return today if the central bank intervenes. Important: Before selling, make sure that the MACD indicator is below the zero line and is only beginning to decline from it.
Scenario #2: Today, I also plan to sell USD/JPY if the price tests 159.25 twice consecutively while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and lead to a reversal lower. A decline toward the opposite levels of 159.10 and 158.79 can be expected.
Important. Beginner Forex traders should exercise extreme caution 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 being caught in 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 account balance 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 spontaneous trading decisions based on the current market situation is fundamentally a losing strategy for an intraday trader.