GBP/JPY: Fourth Drive Down Expected
Good morning Traders and welcome back to EverythingFX.
The Great British Pound is currently trading at 144.229 against the Japanese Yen during today's London Session.
Starting on the weekly timeframe we can see last week had a strong bearish reversal engulfing the prior week where we can see price followed through this week. Dropping to a daily timeframe we had a clean daily break of 145.000. We have however sold ourselves into support and where price has since started stalling!
Looking at a 4-hour timeframe I cam expecting a pullback to re-test 145.000 which was a strong level of support which has now broken and potentially turned into resistance. I will then be awaiting some bearish price action to then potentially take a short position down to our next level of support at 142.500 providing a good 250 PIP trade to the downside with a good risk to reward. What would invalidate this trade for me is a break of our descending trendline.
Fundamentally we have Brexit underway again with comments suggesting that PM Theresa May could not make a deal in time of the new extension however we remain cautious for any comments that may arise. Eyes are also on US-China Trade deal which will affect the Yen going forward! Stay tuned to our market news section as well as our twitter for news updates