GBPJPY hit our targets from last week and looks set to continue to be bearish. The strength meter has highlighted the GBP to be weak and getting weaker, so we can look for further bearish opportunities on this pair.
We’re going over GBP/JPY as our targets were recently hit.
In our previous trade, we looked for the opportunity to sell GBP/JPY in line with the overall downtrend. There was a change in trend in the lower timeframe, so we went for the short position.It was in the 50% retracement of the bearish candlestick, and the market dropped nicely and hit the target for 193 pips this morning.
We talked about waiting for the four-hour to line up with a potential lower high or a lower low pattern for a short opportunity. There were great opportunities because we saw a Head and Shoulders pattern, a breakdown, a retest of the neckline area, then a continuation of the trend down.
The trend on the four-hour timeframe is bearish. The price is forming lower lows and lower highs after forming a bearish reversal setup. The bearish trend can offer further opportunities.
We’re back at the previous structure lows. We targeted that area because we saw a significant move up the last time the price was there.
The GBP is weakening on the strength meter. If anything, we’ll likely see some breakouts to the downside. However, there is previous resistance at the structure lows, so I would also like to see the market to pull back to the 151.60 area. We could then look for reversal patterns on a lower timeframe to take this market down to previous lows.
If the price retests the previous four-hour lows around 151.60, we can look for a bearish reversal setup for a move back to the lows. Alternatively, if the price breaks the lows, we can wait for a retest to short the market further.
If the price breaks these lows, we can look for some continuation to the downside. But, at the moment, the GBP is looking bearish. I would like to see a retracement before we take that position once again.
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