GBPJPY weekly outlook
In this forex trading report, we will explore the GBPJPY pair’s weekly perspective, focusing on key developments since March 16, 2020. The market has exhibited a predominantly hawkish trend, limiting opportunities for bearish swing traders and establishing a significant liquidity area between 147.953 and 148.988. This liquidity zone stretches back to November 2016, with multiple instances of the level being tested and broken in both upward and downward movements. Notably, the level was finally breached on March 1, 2021, followed by a successful retest on September 26, 2022, signified by a hammer candlestick pattern, indicating a bullish trend.
Support and Resistance Levels: Prior to evolving into a crucial support, the subsequent resistance at 172.776 can be traced back to a level in February 2016. Remarkably, this level was breached on May 22, 2023, accompanied by a substantial engulfing candle, which remains untested thus far.
Potential Scenarios: From this time frame, two possible scenarios emerge, both with significant implications. Firstly, the 2016 level (in orange) could play a pivotal role and potentially fill the unbalanced area around 163.785. Alternatively, the 172.776 level may lead to a substantial bounce back, offering a compelling opportunity for traders.
In conclusion, GBPJPY has demonstrated a dominant hawkish trend since March 2020, creating a challenging environment for bearish swing traders. The liquidity area between 147.953 and 148.988 has proven to be a critical zone, having been tested multiple times before breaking on March 1, 2021. Subsequent retesting on September 26, 2022, confirmed the level’s significance and indicated a bullish trend. The 172.776 resistance, which was breached in May 2023, offers potential trading opportunities for a strong bounce back, while the 2016 level may also play a pivotal role in the market dynamics. Traders should carefully assess these scenarios and apply appropriate risk management strategies to make informed decisions in this dynamic trading environment.
Support and Resistance Levels: Prior to evolving into a crucial support, the subsequent resistance at 172.776 can be traced back to a level in February 2016. Remarkably, this level was breached on May 22, 2023, accompanied by a substantial engulfing candle, which remains untested thus far.
Potential Scenarios: From this time frame, two possible scenarios emerge, both with significant implications. Firstly, the 2016 level (in orange) could play a pivotal role and potentially fill the unbalanced area around 163.785. Alternatively, the 172.776 level may lead to a substantial bounce back, offering a compelling opportunity for traders.
In conclusion, GBPJPY has demonstrated a dominant hawkish trend since March 2020, creating a challenging environment for bearish swing traders. The liquidity area between 147.953 and 148.988 has proven to be a critical zone, having been tested multiple times before breaking on March 1, 2021. Subsequent retesting on September 26, 2022, confirmed the level’s significance and indicated a bullish trend. The 172.776 resistance, which was breached in May 2023, offers potential trading opportunities for a strong bounce back, while the 2016 level may also play a pivotal role in the market dynamics. Traders should carefully assess these scenarios and apply appropriate risk management strategies to make informed decisions in this dynamic trading environment.
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