2025/08/01 USD/JPY Trade Strategy
Today's USD/JPY call: Buy.
Over the past week or so, the monthly chart closed with a long bullish candle, and the weekly chart is also very likely to finish as a bullish candle.
From a day-trading perspective the move is overextended, so I’d like to wait for a 1-hour-level pullback first.
Scenario A
If it still keeps pushing higher, there’s no choice but to follow it.
Basically, if it rises, I’m waiting for a pullback; if it falls, I’m waiting for a retracement.
Target is 151.4
Scenario B
If the current range holds firm, I’ll buy from the range low.
I’m assuming the range will break, but if it stalls at the range high of 150.9, I’ll take profit.
Scenario C
If it breaks below the range, I’ll sell.
This would be the drop that forms the 1-hour-level pullback.
I’m expecting the target to be somewhere in the pink-shaded zone of around 150–150.2.
Review
It was Scenario C.
Price moved by the book, so it was an easy one to get into.
There were several entry opportunities inside the red circle.
After that, it fell slightly short of the target, but since it stalled right at the line, I took profit. 23 pips
Without a data release coming up, this would have been a spot to hold. But if price turned around from here, there was a chance it would be back near breakeven by the time of the data release, so I took profit.
After that, price dropped sharply on the NFP (nonfarm payrolls) release.
Looking back, it ended up as a clean technical sell-the-retracement trade, but that was just luck.
As I also wrote in the GBP/JPY post, “I should have held” is just hindsight. It’s scary to imagine what would have happened if I had held and price had instead risen by the same amount.
When the market moves one-sidedly, even stop losses stop working, so the golden rule is: don’t gamble.
This article reflects the author's personal view of the market. It does not recommend any specific trade; all investment decisions are your own responsibility.
