FX.co ★ USD/JPY: Simple Trading Tips for Beginner Traders on November 18. Analysis of Yesterday's Forex Trades

Analysis of Trades and Trading Tips for the Japanese Yen

The price test at 154.83 coincided with the MACD indicator just beginning to move upward from the zero mark, providing a good entry point to buy the dollar, resulting in an increase of more than 50 pips in the pair.

News about the sharp decline in Japan's GDP and strong data on the growth of the Empire Manufacturing Index in the U.S., along with statements from Federal Reserve representatives, exerted significant pressure on the yen against the dollar.

The Empire Manufacturing Index surged to 18.6 points, exceeding analysts' expectations, which had forecast 6.1 points. This indicates a confident growth in manufacturing activity in the region and signals potential strengthening of the U.S. economy as a whole. At the same time, statements from Fed representatives regarding the need for caution in monetary policy concerning interest rate cuts reassured investors. The combination of these factors led to increased demand for the U.S. dollar.

Regarding the intraday strategy, I will also rely more on the execution of scenarios #1 and #2.

Buy Scenarios

• Scenario #1: I plan to buy USD/JPY today upon reaching an entry point around 155.23 (green line on the chart), with a target at 155.60 (thicker green line on the chart). Near 155.60, I intend to exit the long positions and open shorts immediately in the opposite direction (anticipating a movement of 30-35 pips from the level). It's best to return to buying the pair during corrections and significant pullbacks in USD/JPY. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning an upward move from it.
• Scenario #2: I also plan to buy USD/JPY today in the event of two consecutive tests of the price at 155.01 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. An increase towards the opposing levels of 155.23 and 155.60 can be expected.

Sell Scenarios

• Scenario #1: I plan to sell USD/JPY today only after updating the 155.01 level (red line on the chart), which will trigger a quick decline in the pair. The key target for sellers will be the 154.66 level, where I plan to exit the shorts and immediately buy back in the opposite direction (anticipating a move of 20-25 pips from the level). It is better to sell as high as possible. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning its downward movement from it.
• Scenario #2: I also plan to sell USD/JPY today in the event of two consecutive tests of the price at 155.23 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decrease towards the opposing levels of 155.01 and 154.66 can be expected.

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 where profit can be secured, as further increases above this level are unlikely.
• Thin Red Line: Entry price for selling the trading instrument.
• Thick Red Line: Estimated price where Take Profit can be set or where profit can be secured, as further decreases below this level are unlikely.
• MACD Indicator: When entering the market, it is important to be guided by the overbought and oversold zones.

Important: Beginner traders in the Forex market must be very cautious when making trading entry decisions. It is best to remain out of the market before the release of important fundamental reports 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 with large volumes.

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