GBP/JPY has risen in the last few days to get out of the bearish zone. Therefore, the best thing to do is to wait for a long opportunity.

Hi fellow traders! GBP/JPY seems to have recorded another gain on Monday, January 9th. This pair managed to crawl up and rise from the bearish pressure. Thus, waiting for a long opportunity is probably the best scenario you could do now.

gbpjpy

 

Analysis and Recommendation

Let's take a look at the following GBP/JPY H4 chart below: 

gbpjpy 2

Based on the H4 chart above, it has been pointed out that GBP/JPY is being halted around the supply zone of 162.77 – 161.33. When this analysis is written, this pair is consolidating and trying to test the demand zone 159.42 – 158.30. By taking advantage of the bullish momentum, a long opportunity will come when the price test the demand zone.

Be aware if the price breaks through the demand zone. Considering that the GBP/JPY trend is still bearish, the price is expected to return to the bearish lane, presuming that the 158.30 level is successfully cleared.

  • Therefore, set a long position at 159.42 when the price manages to enter the demand zone and a bullish signal confirms it. Stop loss may be positioned at 158.30, while the profit target on 162.77.
  • Alternatively, set a short position at 158.30 when a significant breakout signal confirms it. Stop loss may be positioned at 159.42, while the profit target on 156.33.

Keep in mind to always use risk and money management before trading! In addition, to make use of trailing stops, don't forget to exit the market as soon as you find a reversal signal!

GBP/JPY  key levels: 

  • Resistance: 162.77, 161.33
  • Support: 159.42, 158.30, 156.33, 154.83