In our last report about the GBP/JPY, the pair was trading at 150.65 between support and resistance levels and we recommended buying the pair and take our profit at 152.80. The prices hit the target by more than 220 pips and then recorded the highest price in 15 months at 152.86, around the resistance level before the Brexit.
The pair declined to the support level 147.93 to retest it for the first time since breaking it last month and it’s trading steadily now above the support area, the trend line, and the moving average 50, which are at the same level. This provides us with positive signals for the coming days. The Stochastic indicator is still ahead of the 80 level.
The Next Few Days
After the pair hit our target for the buy position and made a reflective engulfing candle, then returned to retest the support level, we can take another buy position now at 148.65. We should keep our target at 152.80 and use it as a stop-loss level if the pair closes a candle below the uptrend line and the moving average.
This week the markets don’t offer much news from Japan; all the important news will come from the UK where we have the CPI and Carney’s speech tomorrow, and the Average Earnings Index and Retail Sales on Wednesday and Thursday respectively.
