15 March, AtoZForex, Amsterdam – it is every trader’s wish to make hundreds of pips every day, today is one of those days that we have made over 200 pips profit in just one GBPJPY short entry, which we shared in our live market analysis session yesterday.
Markets are often very predictable, especially the JPY pairs due to the fact that they rally with a strong momentum once significant support or resistance levels are broken. As Adrian discussed in today’s Support and resistance webinar, all you need is to avoid fake breakouts for these entries. Enough with the theory, let’s look into further possibilities for GBPJPY and answer the golden question, “where to buy GBPJPY?”
The very first thing that catches attention with the GBPJPY chart is the fact that there are opportunities for both long and short entries:
GBPJPY Short opportunity
Since the pair has broken below its support zone, we are now looking for the previous support at 162.25 level to turn into resistance level with the following short opportunity:
GBPJPY SHORT (Sell limit) @ 162.32, SL@ 162.75, TP1@ 161.99, TP2@ 161.16, TP3@ 160.00
GBPJPY Long opportunity
Fibonacci analysis is giving us possible expectations for a bullish correction wave or even possible a long term correction which is as well probable. As the market is moving with a strong bearish momentum, the next significant support lies within 158.50 level corresponding with 138.2% Fibonacci retracement zone.
GBPJPY LONG (Buy Limit) @ 158.40, SL@ 158.00, TP1@ 159.09, TP2@ 160.00, TP3@ 161.01
High Risk level
Ahead of tomorrow’s FOMC meeting JPY is acting as a safe heaven asset while possible Brexit fears are still ruling the GBP weakness. If we were to set a correlation between GBPJPY and GBPUSD, we could also then expect to see a possible market reversal from GBPUSD at 1.4040 level which would also fall onto 38.2% daily Fibonacci retracement zone. These levels would also mark the time correlation of these two pairs. However, traders should not rule the FOMC meeting consequences out for tomorrow as the volatility is expected to rise with it.
As usual the market will focus on two main fundamental KPIs for the FED:
- Inflation expectations
- Employment levels
As a part of the inflation expectations we will also look for the FED’s confidence in global economy as well as their expectations for the potential rate hike for 2016.