The Power of JPY indicator for MT4 measures the relative strength of the Japanese Yen currency in real-time.
When the relative strength of the JPY currency is strong (above the zero level), trade it against a weak currency.
For instance, when the Japanese Yen is strong and the U.S. Dollar is weak, sell the currency pair (USD/JPY).
Please note that the U.S. Dollar is the base currency and the Japanese Yen the counter currency.
Vice versa, when the relative strength of the JPY currency is weak, trade it against a strong currency.
For instance, when the Japanese Yen is weak and the U.S. Dollar is strong, buy the currency pair (USD/JPY).
- The Japanese Yen is considered strong when its relative strength is trading above the 0.00 level.
- The Japanese Yen is considered weak when its relative strength is trading below the 0.00 level.
Key Points
- Power of JPY above the 0.00 level is considered strong. Trade against a weak currency.
- Power of JPY below the 0.00 level is considered weak. Trade against a strong currency.
- Confirm the buy or sell trade entry with other analysis tools.
- Works for any Forex pair with the Japanese Yen included.
Free Download
Download the “Power_of_JPY.ex4” Metatrader 4 indicator
Indicator Chart (USD/JPY D1)
The USD/JPY daily chart below displays the Power of JPY Metatrader 4 forex indicator in action.
Basic Trading Signals
Signals from the Power of JPY Forex MT4 indicator are easy to interpret and goes as follows:
Buy Signal: Open a buy trade as soon as the Power of JPY relative strength crosses the 0.00 level upwards and the counter currency is weak.
Place a stop loss 5 pips below support or apply your own favorite stop loss strategy for buy signals.
Close the buy trade for a reward/risk ratio of 2.5 or better, or apply your own favorite take profit strategy.
Sell Signal: Open a sell trade as soon as the Power of JPY relative strength crosses the 0.00 level downwards and the counter currency is strong.
Place a stop loss 5 pips above resistance or apply your own favorite stop loss strategy for sell signals.
Close the sell trade for a reward/risk ratio of 2.5 or better, or apply your own favorite take profit strategy.
Power of JPY + Forex Trend Scanner MT4 Scalping Strategy
This scalping strategy combines the Power of JPY Forex Indicator for MT4 with the Forex Trend Scanner MT4 Indicator.
The Power of JPY measures the relative strength of the Japanese yen against other major currencies.
A cross above the 0.00 level indicates yen strength, while a cross below shows weakness.
The Forex Trend Scanner displays candle colors on the chart: green candles mark a bullish trend, and red candles indicate bearish momentum.
When these two indicators align, traders can catch short bursts of strong price movement on M5 or M15 charts.
This system is designed for short-term scalping with clear visual signals and minimal lag,
ideal for traders who prefer fast-paced setups on JPY-based pairs like USDJPY, EURJPY, or GBPJPY.
Buy Entry Rules
- The Power of JPY crosses below the 0.00 level, showing JPY weakness against the counter currency (for example, USDJPY becomes bullish when JPY weakens).
- The Forex Trend Scanner displays green candles, confirming a bullish market bias.
- Enter a buy trade when both indicators align on the same or consecutive candles on the M5 or M15 chart.
- Place stop loss 10–15 pips below the latest swing low (on M5) or 20–25 pips below (on M15), depending on volatility.
- Set a take profit target between 20–40 pips for M5 or 40–60 pips for M15.
- Or exit the trade when the Power of JPY rises above 0.00 or the Trend Scanner changes to red candles.
Sell Entry Rules
- The Power of JPY crosses above the 0.00 level, showing JPY strength against the counter currency (for example, USDJPY becomes bearish when JPY strengthens).
- The Forex Trend Scanner displays red candles, confirming bearish momentum.
- Enter a sell trade when both signals align on the same or consecutive candles on the M5 or M15 time frame.
- Set stop loss about 10–15 pips above the most recent swing high (on M5) or 20–25 pips (on M15).
- Take profit between 20–40 pips (M5) or 40–60 pips (M15).
- Or close the position when the Power of JPY drops below 0.00 or the candles turn green again.
Advantages
- Combines fundamental strength data (JPY strength/weakness) with clear visual trend confirmation (colored candles).
- Ideal for fast scalping during high-volume sessions such as Tokyo or London overlap.
- Easy to read visually—both indicators display intuitive color cues and clear threshold levels.
- Works effectively on volatile JPY pairs like GBPJPY and EURJPY, offering strong directional moves for short-term trades.
Drawbacks
- In quiet or sideways markets, both indicators may produce choppy signals and lead to false entries.
- The system performs best when volatility is high; during flat Asian sessions, it may underperform.
- Strong news events (such as BOJ announcements) can cause sudden reversals that invalidate signals.
- Late signals may occur when trend candles shift color after a large price move, reducing potential reward.
Case Study 1: USDJPY M5 Trade
During the Tokyo session, the Power of JPY dropped below 0.00, signalling yen weakness.
On the USDJPY M5 chart, the Forex Trend Scanner printed green candles.
The trader entered a buy at 151.30 with a 15-pip stop loss.
Price quickly rose to 151.65, achieving a 35-pip profit before the candles turned red, prompting an exit.
Case Study 2: GBPJPY M15 Trade
In the London session, the Power of JPY moved above 0.00, showing yen strength.
The Forex Trend Scanner switched to red candles.
A short position was entered at 188.90 with a stop loss at 189.15 (25 pips).
The pair dropped to 188.30 within 40 minutes, securing 60 pips before the candles reverted to green.
Strategy Tips
- Focus on pairs where the yen is the quote currency (USDJPY, GBPJPY, EURJPY) for the cleanest signals.
- Trade during high liquidity hours, such as the Tokyo or early London session, when JPY pairs are most active.
- Always verify that the Power of JPY movement is consistent with other JPY pairs before entering trades.
- Use a higher time frame (H1) to confirm the dominant direction before taking scalps on M5 or M15.
- Adjust take profit levels based on volatility; GBPJPY tends to move faster than USDJPY, so use wider targets.
- When the Forex Trend Scanner changes color but the Power of JPY remains on the same side of 0.00, consider waiting for confirmation before reversing direction.
- Keep your spreads and execution speed tight; every pip matters in scalping.
- Avoid trading near high-impact Japanese news events like BOJ rate decisions or inflation releases.
- Use trailing stops once the trade moves in profit by at least 20 pips to lock in gains.
- Backtest across several JPY pairs and note which ones produce the most stable results under this strategy.
Download Now
Download the “Power_of_JPY.ex4” MT4 indicator
Adjustable Parameters & Settings
Colors, width, style.
Feel free to explore the indicator’s different parameters and settings to create your own personalized indicator setup.
More Info About This Indicator
Recommended Currency pairs: Any
Trading Platform: MT4
Time Frames: M1, M5, M15, M30, H1, H4, D1, W1
Indicator Type: Currency strength
