FX.co ★ USDJPY: Simple Trading Tips for Beginner Traders on August 11. Analysis of Yesterday's Forex Deals

Analysis of Deals and Trading Tips for the Japanese Yen

The price test at 158.94 coincided with the moment when the MACD indicator had just begun moving upward from the zero mark, confirming the correct entry point for buying dollars. As a result, the pair rose to the target level of 159.37.

Yesterday, in the absence of important data from the US, the main event was an interview with Cleveland Federal Reserve Bank President Beth Hammack, who stated that several rate hikes might be necessary to bring inflation back to 2%. This hawkish stance partly provoked the strengthening of the dollar. For the yen, such a signal put pressure, as increased expectations for the Fed's rate hikes widen the gap between the hawkish American central bank and the much more cautious Bank of Japan. This difference traditionally weakens the Japanese currency, and against the backdrop of Hammack's hawkish statements, the USD/JPY pair had grounds for growth. It is also worth recalling the intervention factor, as the BOJ has intervened in the market to support the yen during its sharp weakening, so further strengthening of the dollar could again bring authorities closer to such a step.

As for the intraday strategy, I will rely more on implementing Scenarios No. 1 and No. 2.

Buying Scenarios

Scenario No. 1: I plan to buy USD/JPY today upon reaching the entry point around 159.34 (green line on the chart) with a target for growth to the level of 159.81 (thicker green line on the chart). At around 159.81, I plan to exit the long positions and open short positions in the opposite direction (anticipating a movement of 30-35 pips in the opposite direction from the level). It is best to return to buying the pair on corrections and serious drawdowns of USD/JPY. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just starting to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today in the event of two consecutive tests of 159.08, with the MACD indicator in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. One can expect growth to the opposite levels of 159.34 and 159.81.

Selling Scenarios

Scenario No. 1: I plan to sell USD/JPY today only after updating the level of 159.08 (red line on the chart), which will trigger a rapid decline in the pair. The key target for sellers will be 158.67, where I plan to exit shorts and open longs immediately in the opposite direction (anticipating a move of 20-25 pips in the opposite direction from the level). Sellers will return at any moment; it just takes any hint from the central bank. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just starting to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today if there are two consecutive tests of 159.34 while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. One can expect a decline to the opposite levels of 159.08 and 158.67.

What the Chart Shows:

• Thin green line – entry price for buying the trading instrument;
• Thick green line – estimated price where take profit can be set, or profit can be realized, as further growth above this level is unlikely;
• Thin red line – entry price for selling the trading instrument;
• Thick red line – estimated price where take profit can be set, or profit can be realized, as further decline below this level is unlikely;
• MACD Indicator. When entering the market, it is important to be guided by overbought and oversold zones.

Important: Beginner forex traders need to make entry decisions very cautiously. Before key fundamental reports are released, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without placing stop orders, you can quickly lose your entire deposit, especially if you do not practice money management and trade large volumes.

And remember, successful trading requires a clear trading plan, as outlined above. Making spontaneous trading decisions based on the current market situation is inherently a losing strategy for intraday traders.