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GBPJPY has broken out of the highs of a trading range after positive manufacturing and services PMI data. Will this momentum continue?

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How To Trade Forex- GBPJPY

The price of GBPJPY has traded through the range highs of 162.00. Price has been within this range between the lows of 156.00 and highs of 162.00 since the start of the year. Both the GBP and JPY have been weak over that period of time which has caused this trading range. However, today in the news, the manufacturing and services PMI data came in above previous and expectations causing the GBP to strengthen. The Bank of Japan (BoJ) is leaving interest rates super low which could cause the JPY to weaken. 

Now the price has broken through the range highs we could look for opportunities to trade higher to the next resistance level. Minor resistance can be found at 166.00 but the major resistance is at 169.00. This means we could be looking at a 400-700 pips move to come for GBPJPY.

If the price can retrace back to the range highs, we can begin to look for bullish trading patterns. This could include the double bottom or inverse head and shoulders on a lower time frame. 

how to trade forex GBPJPY technical analysis chart 21-2-23

The price on the chart has traded through multiple technical levels and some observations included:

  • Price has rallied through the range highs of 162.00.
  • A retest with bullish price action could offer a long opportunity to traders looking to get long.
  • Minor resistance can be found at 166.00.
  • Major resistance can be found at 169.00.
  • Traders will need to identify bullish reversal patterns if the price retests support. 

Have you watched our USDJPY analysis? You can see it here

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