2025/08/26 USD/JPY Trade Strategy

Today's USD/JPY call: Sell.

Yesterday was a day of retracement after Friday’s big drop.
Price is now heading lower again, so this is a spot to look for selling the rally.
The daily chart picture hasn’t changed since the start of August.

Scenario A
If price breaks above the price zone around pink Line A, I’ll consider buying.
I have a feeling the area between Line B and Line A will be tricky to trade, so if I buy, it’ll be after a break to the upside.
That said, I don’t think there’s much room to run.
Target: 147.9

Scenario B
I see the area around Line B as the first candidate for selling the rally.
I’ll wait for the short-term rise to stall before going short.
Target: 146.7

Scenario C
If price falls after only a shallow retracement, I’ll sell, aiming for a support/resistance (S/R) flip near the recent low.
The area around the blue line above C is also a candidate for a retracement.
Target: also 146.7

Review

Price rose right away, so the strategy changed.

Basically, the 147.9 level I wrote about this morning is the range high.
Scenario A was also a scenario of buying up to the range high.
Since price rose and reached that high, the strategy then shifts to catching the drop from the range high.

As a retracement after the bearish shift, the red circle is the best spot.
However, it pulls back from a half-baked level, so you can’t take much. 13 pips

After that there was also a data release, so nothing to do.

In terms of selling from the 1-hour range high, a short from around the blue circle is valid.
On the 15-minute chart it hasn’t made a bearish shift yet, so it’s short-term countertrend trading,
but on the 5-minute chart (M5) it has made a bearish shift, so you can sell based on that.