FX Forecast - GBP/JPY Our Expectations: Rising trend, correction to horizontal and diagonal support. Possibility to entry "BUY" with stop at 146.46
Alternative scenario: If the price goes below the horizontal and diagonal supports, as well as the 200 SMA, the moods will shift to short, where we can look for new short positions after a test of the breakaway.
Commentary: GBP/JPY's trend remains long, as the market selloff from a couple of weeks ago had benefitted the Yen, sending the cross in correction zone close to key technical levels. The zone of horizontal supports is considered strong, as it withstood the test in the last two attempts of a break, as well as before, when acting as a resistance. This zone coincides with diagonal support, 23.6% Fibo and 200 SMA. Price action signal from a pin bar and 50% correction of the signal - bullish. TD Sequential counted 9, which means that the correction is over and the long will resume. Demarker comes off the over-sold area, signalling for long. During the last week the market volatility stepped down a notch, as markets erased the better part of their losses. This balancing will make investors allocate their capitals from the Yen - a strongly preffered FX Hedging instrument - which will additionally support the forecast for growth.
Stop Loss: 146.46
Jr Trader Alexander Kumanov
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