The GBP/JPY currency pair is still trading around the highest level itreached in more than a year after the Brexit. It retested the resistance level 148.00 three times in the past, and last month’s candle closed near the opening price as a Doji candle, which may tell us that the pair will drop in the next days. Before we get ahead of ourselves, let’s analyze the chart to recognize the available opportunities to generate earnings.
On the daily chart the pair is trading in a series of impulse waves inside a price channel between two key levels at 148 and 144, which refer to the average from the last 50 candles. The pair tried to break the 148 level three times and failed, so we think it will decline to the lower limit of the channel again.
On the H4 chart, we will find a sub-price channel in the short term; the pair might reach the highest limit after today’s positive data from the UK about the Manufacturing PMI which came at 55.1, against the forecasted 54.4, so we expect the pair will decline this week unless it breaks the sub-channel.
The Next Few Days
From this daily and H4 chart analysis we can take sell positions around the current levels of 145.95 and place our first take profit level at 144.30, with a second one at 142.90. Then we would start to buy it - but not until we see the signal.
Today we highlight the BOE official rate and the members vote, in addition to the PMIs data from the UK.
