GBPJPY | Perspective for the new week for FX:GBPJPY by darcsherry

The British pound initially tried to rally during the course of the week but turned around to show signs of weakness especially with the formation of an inverted hammer (a bearish trading candle that may indicate that price has reached its peak) on Wednesday. However, zooming out to the larger perspective on daily and weekly time frame, I have observed that price might be going through a correction phase that intends to test Breakout zone @ JY152 to incite a rally in the coming week(s). And with some level of patience, we can take advantage of a Bullish run if it finally happens.

Tendency: Uptrend ( Bullish )
Structure: Supply & Demand | Reversal pattern (Triple Bottom) | Breakout
Observation: i.Since the beginning of October 2021, the Pound recorded an enormous 6.04% growth against the Japanese yet but gave up approximately 60% of its gain in the last 3 weeks to settle around the Breakout zone (which is also the Key level) @ JY152 area at the end of last week trading session.

ii. In the last four months (between July and October 2021), we have witnessed multiple rejections of JY149 to set the tone for Bullish momentum.

iii. After multiple attempts to overcome the Supply zone around JY152, the significant Breakout of JY152 recorded on the 8th of October reveals an emphatic breakthrough for buyers hereby supporting a bullish bias for me.

iv. Technically, the appearance of a triple bottom look-a-like is a bullish chart pattern characterized by three equal lows (JY149 area) followed by a breakout above the resistance level (JY152 area).

v. This important and strong reversal pattern reveals the strength at which the buyers are taking control of the price action from the sellers.

vi. Following the major uptrend that began on the 1st October 2021, it appears price is going through a correction phase that might culminate around a 61.8/ 78.6% retracement of the impulse leg to incite a Trend continuation.
vii . In this regard, I have identified a new Demand level around JY151/152 area for buying opportunities in the coming week(s).

viii. At this juncture in the market, I am of the opinion that above the Key level @ JY152 remains a safe have to take advantage of a buying opportunity
Caveat: Please note that it is likely that price go much lower if breaking down below the Key level happens in the coming hence it is important that I state here that above the key level remains our comfort zone to buy the Pound… Trade consciously!😊
Trading plan: BUY confirmation with a minimum potential profit of 500 pips.
Risk/Reward: 1:5
Potential Duration: 5 to 12days

NB: This speculation might be considered to make individual decisions on the lower timeframe.

Watch this space for updates as price action is been monitored.

Risk Disclaimer:

Margin trading in the foreign exchange market (including commodity trading, CFDs, stocks etc.) has a high risk and is not suitable for all investors. The content of this speculation (including all data) is organized and published by me for the sole purpose of education and assistance in making independent investment decisions. All information herein is for your reference only and I take no responsibility.

You are hereby advised to carefully consider your investment experience, financial situation, investment objective, risk tolerance level, and consult your independent financial adviser as to the suitability of your situation prior to making any investment.

I do not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or the receipt of any instruction or notification therewith.

Past performance is not necessarily indicative of future results.

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