I would like to share this plan with you based on which we will look for possible entries which will be posted as Live Signals on our Twitter page.
After a nice swing up the pair entered in to a range state for a while making equal tops at the 152.85 level. We saw a break of this level 2 weeks ago and after another decent swing up the pair has entered in to a correction. Currently the price is standing a little bit above the previous tops at a level of around 153.20. At this point I anticipate an end to this correction and a new wave up to form at least on the H4 time frame. My views for the GBP/JPY pair are to go Long, but I have prepared with a backup scenario just in case. As you can see on the H4 graph I have outlined two possible scenarios, which I will look in to below:
Scenario 1: In the first scenario I expect for the price to remain above the 152.85 mark and form a new swing up at least to the previous top it made.
Scenario 2: In the second scenario expected outcome is for the price to continue moving down to the 152.00 mark and from there to face a strong support which will lead to a swing up. The target for the possible swing up remains the same – the previous top at around 155.50.
A third possible outcome is for the price to break both 152.85 level and the 152.00 mark and to continue going down confirming that the uptrend for now is over. I have added a small Sell Zone which will be our area of interest if both price levels are broken. I think that this is highly unlikely to happen especially in the short term, but we have to be prepared for anything.
Another thing worth mentioning here is that currently the price is not only standing on a good daily , but also on the H4 it is inside the . A failure to break through the cloud will confirm my expectations and I will anticipate a nice swing up.
Below you can find the zones in numbers and follow up on Twitter for Live Signals:
Buy Zone: 153.50 to 155.50
Optional Buy Zone + Buy Zone: 152.00 to 155.50
Sell Zone: 151.90 to 149.45
Those numbers are not strict, so we might see a little bit of difference throughout the unfolding of the price, but those are the levels we expect for the price to respect.
Also I want to remind you that at 23:30 we have a few major economic reports coming from Japan which might affect the price movements.
I wish everyone happy and profitable trading this week! :)